Mar 31, 2015
The Directors have pleasure in submitting the Tenth Annual Report of the Company together with the Audited Accounts for the financial year ended 31st March 2015.
The summarized financial results are as under :
Year ended Year ended 31st March 31st March 2015 2014
Rs.in lacs Rs. in lacs
1. Revenue from operations 17981.73 22224.02
2. Other income 639.37 743.41
3. Total Expenditure before Interest & 18590.93 21120.72 Depreciation
EBITDA 30.17 1846.71
4. Finance Charges 3212.74 3529.15
5. Depreciation 1027.12 1364.10
6. Profit before Tax (4209.69) (3046.54)
7. Provision for Taxation Â Â
8 (Net profit ti l / Et di t ^ (4209.69) (3046.54) (before Exceptional / Extraordinary items)
9. Exceptional/ Extraordinary items Â 220.07
10. Net Profit (4209.69) (2826.47)
The turnover of the Company is Rs.180 Crores compared to Rs.222 Crores in the previous year. We expect to improve the production and sales in the forthcoming year 2015-16.
There has been no change in the nature of business of the Company during the year under review.
TRANSFER TO RESERVES
Due to losses, the Company is unable to transfer any amount to its Reserves.
No dividend has been declared in the financial year under review having regard to the losses incurred by the company during the year.
The paid-up capital of the Company as at 31.03.2015 stood at Rs.43,11,36,560/- . During the year under review the Company has not made any fresh issue of shares.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
The Company has not declared any dividend in the past and hence transfer of unclaimed Dividend to Investor Education and Protection fund does not arise.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return pursuant to the provisions of Section 92 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, in Form MGT-9 is furnished in Annexure A and is attached to this report.
BOARD / COMMITTEE MEETINGS CONDUCTED DURING THE PERIOD UNDER REVIEW
During the year under review, 4 Meetings of the Board of directors, 4 Meetings of the Audit Committee, 2 Meetings of the Nomination and Remuneration Committee and 4 Meeting of the Stakeholders Relationship Committee were held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(3)(c) of the Companies Act 2013, with respect to Directors' Responsibility Statement, the Directors confirm that -
a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departure from those standards;
b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss of the company for that period;
c) they have taken Proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) they had devised proper system to ensure compliance with the provisions of all the applicable laws and such systems were adequate and operating effectively;
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OF THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
There have been no frauds reported by the Auditors pursuant to Section 143(12) of the Companies Act, 2013.
DECLARATION OF INDEPENDENT DIRECTORS
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges.
COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND OTHER MATTERS PROVIDED UNDER SECTION 178(3) OF THE COMPANIES ACT, 2013
The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for fixing and revising remuneration of Directors, Key Managerial Personnel, Senior Management Personnel and employees of the Company. The Remuneration policy of the Company is annexed herewith as Annexure B and can also be accessed on the Company's website at the link www.servalakshmi.in/Facilities.html.
COMMENTS ON AUDITORS' REPORT:
With regard to the observations of the Statutory Auditors on the complete erosion of the net worth, your directors are of the view that this will not have any adverse effect since concerted efforts are being taken by the management to tide over the situation.
In respect of the qualification(s) made by the Secretarial Auditor in his Report, your Directors wish to state as under;
Sl N0 Qualification Reply
1 The Company has not appointed Chief The Company is in the process Financial Officer and Company Secretary of appointing and complying after the resignation of Mr. G.V. with the provisions. Ramana as Chief Financial Officer w.e.f. 22.01.2015, and Ms.Praveena Dhanagopal as Company Secretary w.e.f 11.02.2015.
2 The financial statements indicate that Considering the accumulated the Company has accumulated losses and losses and present financial its net worth has been fully eroded situations, the company has and accordingly the Company is a "Sick made an application to the Industrial Company" within the meaning Board for Industrial and of Sick Industrial Companies (Special Financial Reconstruction Provisions) Act, 1985. The Company (BIFR) in order to has made a reference to the BIFR achieve a financial under Section 15 of Sick Industrial rehabilitation. Companies (Special Provisions) Act, 1985, in view of the erosion of the entire net worth of the Company.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013
There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The particulars of every contract and arrangement entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arm's length transactions under third proviso thereto are disclosed in Form No. AOC -2 and forms part of this Report.
The Policy on Related Party Transactions as approved by the Board of Directors of the Company has been uploaded on the Company's website and may be accessed through the link at www.servalakshmi.in/Facilities.html.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and outgo as required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in Annexure C and is attached to this report.
STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY
The Company has a structured risk management policy. The Risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making
DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable.
ANNUAL EVALUATION OF THE BOARD ON ITS OWN PERFORMANCE AND OF THE INDIVIDUAL DIRECTORS AND COMMITTEES
As per the requirements of the Companies Act, 2013 and the clause 49 of the listing agreement, the formal annual evaluation of the Board as a whole, its committees and individual directors was conducted based on the criteria and framework adopted by the Board. The evaluation process include an assessment of each director's eligibility, skills and knowledge and the Board is satisfied that all the Directors on the Board are competent and have the necessary experience to effectively execute their duties.
The Board also evaluated the working of the Committees and the Board expressed its satisfaction on the quality, quantity and timeliness of the flow of the information between the Committees and the Board.
DIRECTORS & KEY MANAGERIAL PERSONNEL
During the year under review, the members have approved the appointment of Mr.S.Srinivasaraghavan, Mr. V.S.Pattabiraman and Mr.D.Muthusamy as the Independent Directors of the Company for a period of five years.
Mr. Y.Rambabu resigned as Whole time Director of the company with effect from 09th August, 2014. The Board places on record its appreciation for the services rendered by Mr.YRambabu during his tenure with the company.
Mr.D.V.A.Manoharan ceased to be a director of the company with effect from 25th April 2014 due to death. The Board places on record the appreciation for Mr.D.V.A.Manoharan's fruitful association with the company.
Mr.B.Sriramulu resigned from the directorship of the company with effect from 01.07.2015. The Board records its appreciation for his association with the company.
The Board at its Meeting held on 8th November, 2014, appointed Mrs. Nithya Nirupama as an Additional Director and Independent Director. Subsequently she resigned from the Directorship of the company with effect from 13.07.2015. The Board records its appreciation for her association with the company
Mr. G.V.Ramana resigned as the Chief Financial Officer of the company with effect from 22nd January, 2015. The Board thanks him for the services rendered during his tenure as CFO.
Ms. Praveena Dhanagopal resigned as the Company Secretary and Compliance Officer of the company with effect from 11th February, 2015. The Board thanks her for providing valuable guidance to the company during her tenure.
As per the provisions of the Companies Act, 2013, Mr.R.Ramswamy, Executive Chairman of the company, retires at this Annual General Meeting and being eligible, offers himself for reappointment. The Board recommends his re-appointment.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiaries, Joint ventures or Associate Companies.
Since the Company has not accepted any fixed deposits covered under Chapter V of the Companies Act, 2013, there are no deposits remaining unclaimed or unpaid as on 31st March 2015 and accordingly, the question of default in repayment of deposits or payment of interest thereon, during the year, does not arise.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATION IN FUTURE
There is no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and company's operation in future.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has adequate internal control systems to monitor internal business process, financial reporting and compliance with applicable laws. The Company periodically reviews the adequacy and effectiveness of the control systems.
The Audit committee of the Board reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the company, recommendations made for corrective action and the internal audit reports. The committee reviews with the statutory auditors and the management, key issues, significant processes and accounting policies.
M/s. S.Krishnamoorthy & Co., Chartered Accountants, Coimbatore were appointed as the Statutory Auditors of the company for a period of three years at the Annual General Meeting held on 26th September 2014. Pursuant to the provisions of Section 139 of the Companies Act, 2013, the ratification of their appointment is to be done at the ensuing Annual General Meeting. The Company has obtained written confirmation from the Auditors to the effect that the ratification of their appointment if made would be in conformity with the provisions of Companies Act, 2013. Members are requested to ratify their appointment.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr.M.D.Selvaraj, MDS & Associates, Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The report of the Secretarial report is annexed herewith as Annexure D to this report.
The Board of Directors on the recommendation of the Audit Committee, have appointed Mr.S.Thangavelu, Cost Accountant, as the Cost Auditor of the company for the financial year 2015-16.
Pursuant to Section 148 of the Companies Act 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the remuneration payable to the Cost Auditor is subject to the approval of the members in a general meeting. The Board recommends the ratification of his remuneration.
Pursuant to Section 209(1 )(d) of the Companies Act, 1956, the Cost Audit Report for the financial year ended 31st March 2014 was submitted to the Central Government on 20.02.2015.
PARTICULARS OF EMPLOYEES
The disclosure as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed herewith as Annexure E and is attached to this report.
The disclosure referred to the Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 does not apply to the Company as there were no employees who are in receipt of remuneration in the aggregate at the rate of not less than Rs.60,00,000/- if employed throughout the year or Rs.5,00,000/- per month if employed for part of the year.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received from any employee during the financial year 2014-15.
As required under Clause 49 of the Listing Agreement with the Stock Exchanges, the report on Management Discussion and Analysis, Corporate Governance as well as Auditor's Certificate regarding compliance of conditions of Corporate Governance forms part of this Annual Report.
(VIGIL MECHANISM) WHISTLE BLOWER POLICY
The Company has provided for adequate safeguards to deal with instances of fraud and mismanagement and to report concerns about unethical behavior or any violation of the Company's code of conduct. The policy can be accessed on the Company's website at www.servalakshmi.in/Facilities.html.
The statements in this Director's Report & Management Discussions and Analysis contain forward looking statements regarding Company's projections & expectations and the actual results could differ materially from those expressed on account of various factors like raw material prices, change in demand, government regulation etc., and the readers are cautioned against placing undue reliance on the same.
Your Directors take this opportunity to place on record their appreciation for the dedication and commitment of its employees at all levels. Your directors thank and express their gratitude for the support and co-operation received from the CDR EG, Central and State Governments, Bankers, Customers, Distributors, Dealers, Suppliers, Shareholders, etc., for their continued faith, support and co-operation.
By order of the Board For Servalakshmi Paper Limited
(Sd/-) Coimbatore R. RAMSWAMY 10th August, 2015 Executive Chairman (DIN : 00010572)
Mar 31, 2014
The Directors have pleasure in submitting the ninth annual report of the company together with the audited accounts for the financial year ended 31st March 2014. The Management Discussion and Analysis (MDA) report has been included at appropriate places in this report.
The summarized financial results are as under.
Year ended Year ended 31st March 2014 31st March 2013 Rs. in lacs Rs. in lacs
1. Net Sales/Income from operations 22224.02 18010.44
2. Other Income 743.41 538.10
3. Total Expenditure 21120.72 17315.22
EBITDA 1846.71 1233.32
4. Finance Charges 3529.15 4353.96
5. Depreciation 1364.10 1351.35
6. Profit before Tax (3046.54) (4471.99)
7. Provision for Taxation - -
8. (Netf Proft (3046.54) (4471.99) (before Exceptional/Extraordinary items)
9. Exceptional/Extraordinary items 220.07 (105.76)
10. Net Profit (2826.47) (4577.75)
The turnover of the Company rose to Rs. 222 Crores (23%) compared to Rs. 180 Crores in the previous year.
With the installation of certain critical equipments, the paper machine is now stabilized with increased runnability and we foresee a considerable increase in the production and sales for the forthcoming Year 2014-15 also.
Due to loss incurred by the Company, the Board has not recommended any dividend for the year ended 31st March 2014.
PERFORMANCE OF THE COMPANY
The total paper production during the Financial Year 2013-14 was 54975 tonnes, out of which 37635 tonnes (68 %) was Newsprint (NP) and 17340 tonnes (32%) was Printing and Writing Paper (PWP).
The Company has exported 13155 tonnes (24 % of production) out of which 2159 tonnes was Newsprint (NP) and 10996 tonnes was Printing and Writing Paper (PWP). Compared with Newsprint, Printing and Writing Paper yields better margin.
INDUSTRY STRUCTURE AND DEVELOPMENTS
The Contribution of Paper towards Education, dissemination of information and knowledge and packaging cannot be matched. Despite the predictions that digital era would render paper obsolete, Paper industry has been growing year after year.
Annual revenue from the Paper Sector to the world economy is more than USD 500 Billion. Current paper consumption nears 400 million tonnes per annum.
Global demand for Paper is expected to grow by 2 - 3 % per annum. Emerging markets are expected to grow by 5%, whereas India is expected to have an annual growth of about 6% per annum slightly ahead of China.
Paper Industry in India is high fragmented, with nearly 1000 paper mills in operation producing nearly 12 Million tonnes of Paper, Paper Boards and Newsprint. The consumption is nearly 13 million tonnes. It is expected to touch almost 14 million tonnes by 2015-16 and 20 million tonnes by 2020, clearing indicating the Scope of the Paper Industry in India. With growing literacy rates and the economy, this seems to be Certain.
As per the ICRA reports, the market size and per capita consumption have grown from 7.3 Kg in 2008-09 to nearly 11 Kg in 2014, clearly exhibiting the growing demand for Paper in India.
India''s effective literacy rate continues to be around 74%. The Education sector received an allocation of Rs. 68728 Crores in the Union Budget 2014.
There is a continuous demand for Newsprint (NP) throughout the year, where as Printing and Writing Paper (PWP) has seasonality. The peak demand for PWP is from January to June every year and July to December is lean period.
OUTLOOK, RISKS, CONCERNS, OPPORTUNITIES AND THREATS
The products News Print and Print and Writing Paper varieties were manufactured using 100% Recycled fibre and hence the products are not comparable to the products of virgin pulp based A-grade mills in quality.
The paper industry is poised for a positive outlook globally. ICRA expects the paper industry to grow at 6%. India has high potential for Paper Industry as the per capital consumption of paper is low compared to other grown up countries.
Non availability of Raw materials is a major concern for the Industry. Our Company imports waste paper and coal. International Market conditions and the rupee fluctuation will have a major impact on the margins of the Company. Also rise in the inflation rates will affect the profitability margins. The high gap between the demand and supply, capacity additions and high energy consumption costs are always a concern.
With better resources, we are concentrating on the higher revenue segment which will earn more EBIDTA. We are aiming for a market capitalization of 5% in the Printing and Writing paper segment as the margins are high compared to other segments. We have a strong domestic and international customer base and dealer network to market our increased capacity. There is a huge potential for exports and our Company is concentrating on increasing the Export turnover.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Internal Control Systems of our Company ensure reliability and integrity of the financial and operational information and Statutory Compliance. Our Internal Auditors carry on periodic audits in all the functional areas and submit their reports to the management. The management reviews the Internal Audit report and ensures immediate corrective measures. The Audit Committee of the Company also periodically reviews the observations of the internal Audit. Annual corporate business plan with division-wise breakup is laid out every year. In line with this plan, capital and revenue expenditure budgets are determined and the actual expenditure is monitored by the Finance head directly for effective control.
The Board of Directors are sad to inform the sudden demise of our Director Mr.D.V.A. Manoharan on 26.04.2014. The Directors wish to place on record their special appreciation to the services rendered by him during his tenure of office as Director.
Mr. Y. Rambabu has tendered his resignation due to his personal commitments and preoccupation and the Board at its meeting held on 9th Day of August 2014 has accepted the same. The Directors wish to place on record their special appreciation to the services rendered by him during his tenure of office as Director.
The Board of Directors had re-designated Mr.R. Ramswamy as Executive Chairman and appointed Mr.Y. Shivaram Prasad as Managing Director of the company for a period of three years with effect from 1st January 2014.
Mr.V.S. Pattabiraman and Mr.D. Muthusamy retire at the ensuing Annual General Meeting and it has been proposed to appoint them as Independent Directors for five consecutive years with effect from 26th September 2014. Mr. S. Srinivasaragavan, Director of the Company, is proposed to be appointed as Independent Director for a period of five consecutive years with effect from 26th September 2014 as per provisions of Section 149 and other applicable provisions of the Companies Act, 2013.
A brief resume, expertise, shareholding in the Company and details of other Directorships of these Directors as stipulated under Clause 49 of the Listing Agreement with the Stock exchange form part of the notice of the ensuing Annual General Meeting.
Your Directors recommend their appointment/re-appointment.
Your Directors acknowledge with gratitude, the valuable financial assistance and support extended by the Company''s Consortium bankers M/s. Indian Overseas Bank, M/s. State Bank of India and M/s. Bank of India.
The Debt Restructuring Package proposed for the Company was accepted by the CDR Cell on 31st January 2014 and the package is implemented successfully and we have received sanction letters from the respective bankers.
The company has not accepted any Fixed Deposits from public during the year and hence there are no unclaimed deposits as at 31st March 2014.
MATERIAL DEVELOPMENTS IN HUMAN RESOURCES/INDUSTRIAL RELATIONS
The Company values and understands the need for continuous growth and development of its people in order to have greater productivity and provide job satisfaction and also equip them to meet growing organizational challenges. We have an excellent harmonious industrial relation at the plant. The company has genuine concern and top priority for safety and welfare of its employees. Health and safety remains an area of very high priority for the company.
CORPORATE SOCIAL RESPONSIBILITY
Our Company is committed to the social and employee welfare and we are determined to help create a better society. Priority is being given to the engagement of labour from the villages around Tirunelveli rural area. The Company is also contributing to the health care activities taken up by the local authorities in Tirunelveli by providing suitable drinking water facilities to the local residents.
As a part of Company''s social responsibility towards ''Green Coverage of Mother Nature'' the Company uses recycled paper and its components to an extent of 100%.
FOREIGN EXCHANGE INFLOW & OUTGO
During the period ended 31st March 2014, the Company''s foreign exchange earnings were Rs. 4956.36 lakhs (Rs. 2608.65 lakhs for the year ended 31st March 2013). The revenue expenditure in foreign currency was Rs. 6882.19 lakhs (Rs. 2902.77 lakhs for the year ended 31st March 2013) and the capital expenditure was Rs. 19.81 lakhs (Nil for the financial year ended 31st March 2013).
A separate section on Corporate Governance and a Certificate from a practicing company secretary of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchange, forms part of the Annual Report.
No employee was in receipt of remuneration in excess of limit set out for disclosure in Directors Report under Section 217 (2A) of the Companies Act, 1956.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The statement showing the particulars of conservation of energy and technology absorption pursuant to section 217(1 )(e) of the Companies Act, 1956, read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is given in the annexure forming part of this report.
The statement in this Directors'' Report & Management Discussion and Analysis contain forward looking statements regarding Company''s projections & expectations and the actual results could differ materially from those expressed on account of various factors like raw material prices, change in demand, government regulation etc., and the readers are cautioned against placing undue reliance on the same.
DIRECTORS'' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors, to the best of their knowledge and belief, hereby confirm that.
a) in the preparation of annual accounts for the financial period ended 31st March 2014, the applicable accounting standards issued by ICAI have been followed.
b) they had selected such accounting policies and applied them consistently and made judgements and estimates that were 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 period and of the profit of the company for the period under review.
c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities and
d) they had prepared the annual accounts for the financial period ended 31st March 2014, on a going concern basis.
The Auditors M/s. S. Krishnamoorthy & Co., Chartered Accountants, Coimbatore retire at the forthcoming Annual General Meeting and being eligible offer themselves for re-appointment. The Audit Committee and the Board recommend the re-appointment of M/s. S. Krishnamoorthy & Co., Chartered Accountants, as Statutory Auditors and the Company has received a certificate from the Statutory Auditors to the effect that their re- appointment, if made, would be within the limits prescribed under Section 139 of the Companies Act, 2013. Members are requested to appoint the Auditors for a period of 3 years commencing from the conclusion of the ensuing 9th Annual General Meeting up to the conclusion of the 12th Annual General Meeting of the Company which ought to be held during the year 2017 subject to the ratification by the Shareholders annually.
Pursuant to the provisions of the Section 233B of the Companies Act, 1956, the Board of Directors of your company on the recommendation of Audit Committee had appointed M/s. Vivekanandan Unni & Associates, as the Cost Auditors for conducting Cost Audit for the financial year 2013-14.
Pursuant to Section 209(1 )(d) of the Companies Act, 1956 and Rule 5 of the Companies (Cost Audit Records) Rules, 2011, the Cost Audit Report for the financial year ended 31st March, 2013 was submitted to the Central Government in the prescribed form on 02.05.2014.
Your Directors take this opportunity to place on record their appreciation for the dedication and commitment of its employees at all levels. Your directors thank and express their gratitude for the support and co-operation received from the CDR EG, Central and State Governments,Bankers, Customers, Distributors, Dealers, Suppliers, Shareholders,etc. for their continued faith, support and co-operation.
By order of the Board For Servalakshmi Paper Limited
(Sd/-) Coimbatore R. RAM SWAMY 9th August, 2014 Executive Chairman
Mar 31, 2010
The Directors have pleasure in submitting the Fifth Annual Report together with the Audited Accounts for the year ended 31st March 2010.
CONVERSION INTO PUBLIC LIMITED
The company was converted into "Public Limited" as per the resolution passed by the shareholders at their meeting held on 30th April 2010.
STATUS OF THE NEW PAPER MILL AND CO- GENERATION PLANT
Paper mill project at Kodaganallur in Tirunelveli District has been completed and trial productions have been carried out and continuous production has commenced. Co-generation plant, which is mainly intended for captive consumption has also commenced operations and the surplus power, if any, will be sold through Power Trading Corporation Limited.
1. Authorised Capital: At the commencement of the year the Authorised Capital, was Rs. 12.50 crores consisting of 1,00,00,000 Equity Shares of Rs.10/- each and 2,50,000 Preference Shares of Rs.100/- each. The 2,50,000 Preference Shares of Rs. 100/- each forming part of the Authorised Capital were converted into 25,00,000 Equity Shares of Rs.10/- each on 29.08.2009. Subsequently, the Authorised Capital was raised to 5,00,00,000 Equity Shares of Rs.10/- each on 29.03.2010. Thus the present Authorised Capital is Rs.50 Crores.
2. Issued and Paid-up Capital: During the financial year 26,86,000 additional Equity Shares of Rs.10/- each were issued at a premium of Rs.40/- per equity share. The Company issued 1,06,94,000 Equity Shares as Bonus Shares in the ratio of 1:1 by way of capitalizing Rs.10,69,40,000/- from share premium account. The present Paid-up Capital is Rs. 21,38,80,000/-.
The company has established an Audit committee as per section 292A of the Companies Act, 1956. The committee comprises of Mr.G.RMuniappan(Chairman), Mr.S.N.Inamdar and Mr.B.Sriramulu. The Terms of Reference of this Committee are wide enough to cover the matters specified in Section 292A of the Companies Act, 1956 and Clause 49 of the Listing Agreement.
Directors Smt. R Jeevanlatha, Smt. Shobana S. Prasad and Smt. Nirupa Sriramulu resigned from the Board on 31st March 2010. The Board records its sincere appreciation for the cooperation and guidance extended by them to the Company.
Further Sri. S N Inamdar, Sri. G. P Muniappan, and Sri. Srinivasaragavan were co-opted by the Board as additional Directors. Their term of office expires on the date of the Annual General Meeting and they are eligible for appointment as Directors of the Company.
Further Sri. R Ramaswamy has been appointed as Chairman and Managing Director of the Company without remuneration w.e.f. 01.04.2010 for a period of 5 years.
Sri. Y. Shivaram Prasad and Sri. B. Sriramulu are the Directors retiring by rotation and being eligible, offer themselves for re-appointment.
The company has not accepted any deposits from public during the year and accordingly there are no unclaimed deposited as at 31/03/2010.
A voluntary Corporate Governance Report together with Management Discussion and Analysis statement forms part of the Annual Report.
Companys Consortium bankers M/s. Indian Overseas Bank, M/s. State Bank of India and M/s. Bank of India have extended financial assistance, both long term and working capital loan.
FOREIGN EXCHANGE INFLOW & OUTGO
There were no exports during the year. However foreign exchange outgo on account of imports were as follows.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The particulars as prescribed under section 217(l)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, are attached as Annexure "A" to this report.
No employee was in receipt of remuneration in excess of limit set out for disclosure in Directors Report u/s 217 (2A) of the Companies Act, 1956.
DIRECTORS RESPONSIBILITY STATEMENT
It is hereby reported 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 judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as on 31st March 2010 and ot the loss oi the company far the year ended on that date;
(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;
The companys auditors M/s.S.Krishnamoorthy & Co., retire at the ensuing Annual General Meeting and they are eligible for reappointment.
Your Directors wish to place on record their appreciation of the contribution of the employees and by the bankers for the timely financial assistance extended.
By order of the Board For Servalakshmi Paper Limited
Kodaikanal (Sd) R. Ramaswamy
11.05.2010 Chairman & Managing Director