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Directors Report of Solitaire Machine Tools Ltd.

Mar 31, 2019

Directors Report To the Members,

The Directors have pleasure in presenting before you the Twenty Seventh Annual Report of the Company together with the Audited Statements of Accounts for the year ended 31st March, 2019.

FINANCIAL RESULTS :

The Standalone performance during the period ended 31st March, 2019 has been as under:

(Rs. in Lacs)

Particulars

Year Ended 31st March, 2019

Year Ended 31st March, 2018

Year Ended 31st March, 2017

Year Ended 31st March, 2016

Year Ended 31st March, 2015

Sales (Net)

1559.64

1652.56

1834.07

1565.5

1079.42

Other Income

29.03

41.56

31.51

26.8

15.44

(Increase) / Decrease in stocks

(222.83)

(28.85)

(19.99)

179.04

(159.21)

Profit Before Taxation

207.95

248.45

305.95

169.54

104.63

Less:

Taxation

73.00

82.00

100.00

66.50

56.00

Excess/Short provision of tax relating to earlier years

7.32

Deferred Tax

(2.16)

(24.51)

14.40

6.43

26.08

Net Profit after Tax

129.79

190.97

191.54

108.87

62.94

Add: Profit brought forward from Previous Year

900.83

776.54

652.25

584.25

547.88

Profit available for appropriation

1030.62

967.51

843.79

693.32

510.82

Less:

Proposed Dividend

49.96

56.77

45.42

34.06

22.71

Corporate Tax on Proposed Dividend

11.56

11.55

9.08

6.81

3.86

Less:

Other Comprehensive Income

0.44

(1.64)

12.75

0.00

0.00

Balance Carried to Balance Sheet

968.66

900.83

776.54

652.25

584.25

The Consolidated performance during the period ended 31st March, 2019 has been as under:

(Rs. in Lacs)

Particulars

Sales (Net)

Year Ended 31st March, 2019

1559.64

Year Ended 31st March, 2018

1652.56

Other Income

29.04

41.58

(Increase) / Decrease in stocks

(222.83)

(28.85)

Profit Before Taxation

199.68

243.03

Less:

Taxation

73.00

82.00

Excess/Short provision of tax relating to earlier years

7.32

-

Deferred Tax

(2.35)

(24.74)

Net Profit after Tax

121.72

185.77

Add: Profit brought forward from Previous Year

907.22

788.13

Profit available for appropriation

1028.94

973.90

Less:

Proposed Dividend

49.96

56.77

Corporate Tax on Proposed Dividend

11.56

11.55

Less:

Other Comprehensive Income

0.44

(1.64)

Balance Carried to Balance Sheet

966.98

907.22

DIVIDEND:

Your Directors recommend dividend of Rs. 49,96,393.6/- which would be 11% on 4542176 equity shares of Rs. 10/- each for the year ended March 31, 2019 subject to members'' approval.

OPERATIONS:

The operation for the year has shown decline in sales compared to previous year. The decline was little over 5 %. The grinders ready with us for over 3 Crores were not picked up by customers. The inventory of semi finish machines went up by 2.6 Crores. The main reason cited was lack of liquidity. The export sales was higher than previous year, but was still only 19 % of total sales.

The uncertainty in domestic as well as International market continues. The entire Machine Tools industry is witnessing this downturn. The major factor is Government decision to implement BS IV standards for Pollution controls from 2020 in auto industry. Diesel engine 4 wheelers will be outdated and eliminated in due course of time. All 2-wheel vehicles have to be electric vehicle in near future. All this is good for world at large, but its immediate effect is being felt in short term by industry. The turmoil would settle down in current financial year.

The Net Profit declined against last year as inventory went up, but was retained at lower of the cost as per norms. The EPS also came down from 4.20 last year to 2.86 in current year.

In spite of the entire negative scenario, your company has remained Debt Free for eighth year in a row. The Company invested about 39 lacs in upgrading equipment. The previous investments in Fixed Deposits, Mutual Funds etc. were retained as it is. The Bank borrowing from Cash Credit Facility was used sporadically and which can be seen from Finance cost.

EEPC has recognized our Export Efforts and for First time gave us an Award as Large Enterprise for year 2016 2017. This was fifth Award in a row. Ms. Shilpa Taneja received Award on behalf of the Company.

The Company had participated in IMTEX 2019 in Bangalore in Jan. 2019. The newly developed model 3-300 was launched at the show and it was widely recognized. The grinder was confirmed for sale with a new customer and it was supplied after due modification for their application in current financial year. Some more new customers were added to our list and their grinders are being supplied / manufactured during current financial year. Your Company has been working with Government of India Atomic Power department. In earlier years we have supplied several grinders to Nuclear Fuel Complex and now we have received one more grinder order for current year. Orders for 4 more grinders have been confirmed for next financial year for their expansion. One of their sister organization has also placed order for their requirements for CNC grinder. Such orders insulate us from downward trend in automotive field in near future. As requirement of Electric Power goes up, Nuclear Power is one of the major sources being sought by Government for protecting environment.

Our thrust for Export sales is continuing in USA, UK and Europe. We will be participating in an Exhibition in Nov. 2019 in Thailand. We hope to tap in to South East Asia market of Thailand, Malaysia and Vietnam.

Due to slowdown in Sales, many of our customers are now opting for Rebuilding / CNC retrofitting of their old grinders to improve on efficiency and productivity. During the year, we rebuilt 5 grinders and we hope to do rebuild / retrofit 6 to 8 grinders in current year. As Diesel engine phases out, the grinders used for manufacturing parts for these engines, are being retooled up for new components. This would give us opportunity to work with customers and earn additional revenue.

The Company continues with Social development and cultural activities for employees and their family. The company had arranged Rangoli Competition, Children day activities, health Check-up for all employees, Dussehra Pooja and distribution of education related activities for employees'' children. The Company plans to further extend Social Development activities in Company''s neighbourhood.

The Company continues to improve skill of employees through training. Few new young employees are being added to work force as our work force would be nearing retirement stage. We are fortunate that we have large number of work force, who have been with us for over 20 years and still working to keep up with technological changes taking place in the world.

The Company thanks all its customers for continued support and faith in meeting their requirements. New customers are being added from time to time making our customer base wider. The Company thanks its bankers, Vendors and Government authorities for their continued support.

BOARD OF DIRECTORS:

By the end of the year Four Independent Directors had completed their terms as an Independent Directors and have retired. We thankfully acknowledge their contribution towards the betterment of company''s working and the guidance provided by them in their respective field of expertise. The retiring Directors are Mr. Anil Kothari, Dr. Amita Shah, Ms. Rashmi Desai and Ms. Padamaja Mukundan. We hope they will continue to guide us as and when we need their assistance.

After rigorous search, we were fortunate to have a new Panel of Independent Directors inducted to work as of beginning of the year. They are:

Mr. Bharat V. Shah - Bharatbhai is an Electrical Engineer from IIT, Mumbai. He is an Entrepreneur and innovator in manufacturing of electrical motors for past 40 years and now retired. He has been associated with Defence Department of India in development of wide variety of Special Purpose Motors for various war ships as well as for first Nuclear Submarine built in India.

Mr. Nilam M. Patel - Nilambhai is an engineer by education and one of the leading builders principally for Industrial buildings. He has an experience of over 45 years in the field and is semi-retired. For last over 10 years, he has been associated with an Architectural college in Vidyanagar as Honorary Director and has guided it to be one of the finest in the region. The college has all advanced facilities for students and are in process of establishing new college campus.

Ms. Kesha K. Thakkar - Ms. Kesha is a commerce graduate and pursuing for Chartered Accountant. She is currently associated with Niyogin Fintech limited in Mumbai. She has wide experience in the field of Audit and Finance. She would be able to guide the company in Accounting, Finance and related activities.

Ms. Nishita G. Rajput - Ms. Nishita has done Masters in CSR field besides other educational achievements. She is a Social Worker in Vadodara and has been operating an NGO for Girl Education. Much before "Beti Bachao, Beti Padhao" campaign, she had started to work for Girl education. In current year, she plans to arrange for school and college fees for over 10,000 girls and boys. She also arranges for Daily meal delivered free of cost for over 180 old ladies. She will guide us to see that we also meet our social responsibilities, as we have gained a lot from society.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

As required under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report is enclosed as a part of this report.

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Report on Corporate Governance and Management Discussion and Analysis Reports has been included in the report. Your company has been practicing the principle of good Corporate Governance over the year. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

LISTING WITH STOCK EXCHANGES:

The Company confirms that it has paid the Annual Listing Fees for the year 2019-20 to BSE where the Company''s Shares are listed.

DEMATERIALISATION OF SHARES:

89.08 % of the company''s paid up Equity Share Capital is in dematerialized form as on 31st March, 2019 and balance 10.92 % is in physical form.

NUMBER OF BOARD MEETINGS HELD:

The Board of Directors duly met 5 times during the financial year from 1st April, 2018 to 31stMarch, 2019. The dates on which meetings were held are as follows:

19th May, 2018, 4th August, 2018, 27th October, 2018, 9th February, 2019 and 29th March, 2019.

DIRECTORS:

The Board of Directors are duly constituted. As per provisions of Companies Act, 2013 for retirement by rotation, all executive directors are now liable to retire by rotation.

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. The term of all the three Independent Directors expired as on 31st March, 2019. They have tendered their resignation and are no longer associated with the Company with effect from 31st March, 2019.

DIRECTORS RESPONSIBILITY STATEMENT:

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

a) In the preparation of the annual accounts for the year ended 31st March, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures;

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

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

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

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

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

COMMENTS ON AUDIT OBSERVATIONS:

The Notes on financial statement referred to in the Auditors'' Report are self-explanatory and do not call for any further comments. The Auditors'' Report does not contain any qualification, reservation, adverse remark or disclaimer.

DISCLOSURE ON NON-APPLICABILITY OF MAINTENANCE OF COST RECORDS

The maintenance of Cost records as specified by the Central government under sub section (1) of Section 148 of the Companies Act, 2013 is not applicable on the Company.

COMMENTS ON SECRETARIAL AUDITOR''S OBSERVATIONS:

There is no malafide intention on the part of company and delay if any, in the matter is inadvertent and caused due to oversight. The Company is in process of complying all the requirements of the Companies Act, 2013 and amended listing agreement.

AUDITORS:

Statutory Auditors:

M/s. Ajay Shobha & Co. (Firm Registration No.: 317031E), Chartered Accountants, Mumbai were appointed as Statutory Auditors for financial year 2017-18 to 2021-22 at the Annual General Meeting held on 29th July, 2017. The requirement to place the matter relating to appointment of Auditors for ratification by members at every Annual General Meeting is done away with vide notification dated 7th May, 2018 issued by the Ministry of Corporate Affairs. Accordingly, no resolution is proposed for ratification of appointment of Auditors.

Secretarial Audit:

According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit Report submitted by Company Secretary in Practice is enclosed as a part of this report Annexure-A.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

a. CONSERVATION OF ENERGY:

The company''s operations do not involve substantial consumption of power in comparison to costs of production. However, regulatory measures are there to ensure that the consumption of power is within the norms.

b. TECHNOLOGY ABSORPTION:

The company has fully absorbed the technical know-how received from USA and Italy.

c. FOREIGN EXCHANGE EARNING AND OUTGO:

Foreign exchange earnings of the company during the year 2018-2019 were Rs.296.69 Lacs (Previous Year Rs. 234.01 Lacs) while outgoings were 98.59 Lacs (Previous Year Rs. NIL).

VIGIL MECHANISM:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.smtgrinders.com under http://www.smtgrinders.com/policies/ link.

RELATED PARTY TRANSACTIONS:

Related party transactions that were entered during the financial year were on an arm''s length basis and were in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year as per Form AOC-2 is enclosed as Annexure- B.

The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules there under and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company at www.smtgrinders.com under http://www.smtgrinders.com/policies/ link.

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-C.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

There are no Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 during the current Financial Year.

REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:

i. The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in respect of employees of the Company and Directors is furnished hereunder:

S.

No.

Name

Designation

Remuneration paid FY 18-19

Remuneration paid FY 17-18

Percentage Increase in remuneration from previous year

Ratio/Times per Median of employee remuneration

1

Mr. Ashok Sheth

Chairman &

Managing

Director

Rs. 12,80,920

Rs. 15,86,460/-

(19.26%)

4.59

2

Mr.

Hemandra

Badani

Managing

Director

Rs. 12,94,935

Rs. 16,09,722/-

(19.55%)

4.64

3

Mr. Harsh Badani

Whole Time Director

Rs. 11,55,108

Rs. 13,46,573/-

(14.22%)

4.14

ii. Percentage Increase in Median Remuneration of Employees in the Previous Year:

Total

Employees in FY 2017-18

Median Remuneration of Employees in FY 2017-18

Total Employees in FY 2018-19

Median Remuneration of Employees in FY 2018-19

Percentage

Increase

70

256747

78

278883

8.62%

iii. Average percentage increase in Employee remuneration- 3.85 %

iv. Average percentage increase in Managerial Remuneration- (17.87%)

PARTICULARS OF EMPLOYEES

The total number of on roll employees in Company as on 31st March, 2019- 78

Details of employees which are covered under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is as follows:

A. Top ten employees in terms of remuneration:

Name of Employee

Date of

Commencem ent

Date

of

Resig nation

Total

remuneration

paid

Qualification & Experience

Designation

Age

Last

employment

Relation

with

Director

Ashok

Sheth

10/09/1987

-

Rs. 12,80,920

B.S-Mechanical Engineering USA with 49 Years of experience

Chairman & MD

71

N.A

Himself

Hemandra

Badani

10/09/1987

-

Rs. 12,94,935

B Com Graduate with 44 years of experience

Vice

Chairman and MD

66

N.A

Himself

Harsh

Badani

31/01/2015

-

Rs. 11,55,108

B.E-Mechanical and MBA with 10 years of experience

WTD

34

N.A

Himself

N M B Khan

15/06/1992

-

Rs.759837

Commerce Graduate with 34 years of experience

Dy. General Manager-Finance & Corporate affairs

56

KR

Kanakiy a & Co.

N.A.

M I Gohil

01/04/2001

-

Rs.588814

ITI with 27 years of experience

Assembly

Manager

55

N.A.

N.A.

M.A

Bidiwala

09/11/1991

-

Rs.561535

DME with 26 years of experience

QC and Developme nt Manager

47

N.A.

N.A.

Atul Modi

01/11/1996

-

Rs.484199

M.Com with 21 years of experience

Purchase

Officer

51

Geeta

Valves

N.A.

Girish D Goswami

01/10/1995

-

Rs. 483420

ITI with 24 years of experience

Supervisor

46

N.A.

N.A.

Ranjit

D.Soni

01/06/1991

-

Rs.480785

ITI with 28 years of experience

Sr.

Machinist

50

N.A

N.A.

Vinu D parmar

01/06/1991

-

Rs.452609

ITI with 28 years of experience

Sr.

Machinist

52

N.A

N.A

B. Employed throughout the year under review & were in receipt of remuneration in aggregate of not less than Rs. 1,02,00,000/- p. a. or Rs. 8,50,000/- per month if employed for part of the year: N. A.

C. Person who are getting more remuneration than MD, WTD or manager and hold 2% or more equity shares together with spouse and dependent children: N. A.

DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY:

The Company has been addressing various risks impacting the Company and the policy of the Company on risk management is provided elsewhere in this Annual Report in Management Discussion and Analysis.

INTERNAL FINANCIAL CONTROLS

Your Company has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business including adherence to the Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

DISCLOSURE REGARDING MSME SUPPLIERS

The Company has as on 31st March, 2019 a total amount of Rs. 7,72,313 as pending for more than 45 days towards the payment of Micro and Small enterprise registered under Micro, Small and Medium Enterprise Act, 2006.

Out of which an amount of Rs. 276563 is still pending to one supplier because of the work pending from his side. For the rest they are our regular suppliers and so bulk payments are made to them almost every month, Company has made the payment of their respective pending amounts as on 18th April, 2019.

POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE

The Company has zero tolerance for sexual harassment at workplace, and has constituted an Internal Complaints Committee against sexual harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Committee aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. The Company has not received any complaint of sexual harassment during the financial year 2018-19.

PERFORMANCE EVALUATION

The Company has devised a Policy for performance evaluation of the Board, Committees and other individual Directors (including Independent Directors) which include criteria for performance evaluation of Nonexecutive Directors and Executive Directors. The evaluation process inter alia considers attendance of Directors at Board and committee meetings, acquaintance with business, communicating inter se board members, effective participation, domain knowledge, compliance with code of conduct, vision and strategy. The Board carried out an annual performance evaluation of the Board, Committees, Individual Directors and the Chairperson. The Chairman of the respective Committees shared the report on evaluation with the respective Committee members. The performance of each Committee was evaluated by the Board, based on report on evaluation received from respective Committees.

The report on performance evaluation of the Individual Directors was reviewed by the Chairman of the Board and feedback was given to Directors.

DETAILS OF FRAUDS REPORTED BY THE AUDITORS

No frauds have been reported by the auditors under sub-section 12 of section 143 of the companies Act, 2013.

ACKNOWLEDGEMENT:

Directors take this opportunity to express thanks to various departments of the Central and State Government, Bankers, Material Suppliers, Customers and Shareholders for their continued support and guidance. The Directors wish to place on record their appreciation for the dedicated efforts put in by Employees of the Company at all levels.

For and on behalf of Board of Directors

Sd/-

ASHOKJ SHETH

Chairman and Managing Director

DIN:00174006

Place: Vadodara

Date: 18/05/2019


Mar 31, 2017

Directors Report To the Members,

The Directors have pleasure in presenting before you the Twenty Fifth Annual Report of the Company together with the Audited Statements of Accounts for the year ended 31st March, 2017.

FINANCIAL RESULTS:

The performance during the period ended 31st March, 2017 has been as under:

(Rs. in Lacs)

Particulars

Year Ended 31st March, 2017

Year Ended 31st March, 2016

Year Ended 31st March, 2015

Year Ended 31st March, 2014

Year Ended 31st March, 2013

Sales (Net)

1834.07

1565.5

1079.42

923.08

1036.45

Other Income

31.51

26.80

15.44

20.66

14.71

Increase/ (Decrease) in stocks

(19.99)

179.04

(159.21)

84.90

57.00

Profit Before Taxation

248.49

169.54

104.63

58.52

141.85

Less: Taxation

100.00

66.50

56.00

25.00

50.00

Add/Less: Deferred Tax

5.39

6.43

26.08

3.70

1.11

Net Profit after Tax

140.36

108.87

62.94

37.21

88.17

Add: Profit brought Forward from Previous Year

601.82

547.45

525.39

514.75

466.16

Profit available for appropriation

742.18

656.32

588.33

551.96

554.34

Proposed Dividend

56.77

45.42

34.06

22.71

34.07

Corporate Tax on Proposed Dividend

Transfer to General Reserve

11.56

9.08

6.81

3.86

5.53

Balance Carried to Balance Sheet

0.00

0.00

0.00

0.00

0.00

673.85

601.82

547.45

525.39

514.75

DIVIDEND:

Your Directors recommend dividend of Rs. 56, 77,720/- which would be 12.5% on 4542176 equity shares of Rs. 10/- each for the year ended March 31, 2017 subject to members'' approval.

OPERATIONS:

The operation for the year has shown moderate growth and the momentum to get bigger share of market has sustained. New customers have been added during the year especially in International market. The company increased sales by 17 % and Export share was almost 40 %. During the year Machines / Spares were sold in Australia, New Zealand, Turkey, Italy, UK and USA. The single order from Turkey was for over 2 Crores from a new customer. This shows the faith and trust entrusted by our overseas customers in SMT. the sales would have been bit higher if the machines ready would have been collected by the customers. This is one of the reasons for increase in inventory.

Once again, the Company recorded highest ever revenue of Rs.1834.06 Lacs. The net profit of Rs. 140 Lacs, was up by 29 % from previous year. The EPS went to Rs. 3.09 against previous year of Rs. 2.40.

Your company has remained DEBT FREE and has been DEBT FREE since 2011-2012. The Company invested Rs. 80 Lacs in Capital Goods and Rs. 50 Lacs in Bank Deposits during the year from its own internal accruals. The Company was able to manage funds requirement so that even use of cash Credit facility of Bank was used to minimum.

EEPC has for Third consecutive time recognized the Export Achievements of the Company and awarded Star Performer for the year 2014-2015. The award was handed over by Central Renewable Energy Minister Shri Piyush Goyal to Ms. Shilpa Taneja in Mumbai.

During the year, Company went a step further to extend use of Renewable Energy by installing Solar Power system at Chhani plant. The plant capacity is 45 KW, about 50 % of allowed sanctioned load as per the norms of Gujarat Government. During the six-month period from October to March, average monthly saving was 5,500 units of Power, equivalent of Rs. 49,500 / month. This is also equivalent of saving close to 250 trees / year. Besides, the rent collected by allowing use of Gorwa plant roof for solar power generation was Rs. 2.69 Lacs.

The year started with healthy order book and more orders are under negotiation. The good monsoon could mean boom in Vehicle production and expected growth in Machine Tools production. The new Thrust on Aerospace and Defense manufacturing would call for Precision grinders. Your Company has already become part of AeroDef group of our Association, IMTMA. All new inquiries from these group of industries would be passed on to this group. These industries have large potential and we should see benefit in next 3 to 5 years.

During the year, Company worked with a German group to design grinder to their specifications. With joint effort, the grinder was perfected to European standards and was delivered to their plant in India. The group has presence in over 60 countries and is targeting to use our grinders for their worldwide requirements in years to come. In similar scenario, the Company has taken an order for Rebuilding and CNC retrofitting of six grinders for an American company under their guidance and standards. The work is progressing well on this project. The grinders have been received from USA.

The Company continuedits social responsibility with its own resources for its own employees and their families.

As you are aware, this is Silver Jubilee year for Company since it became a Public Limited Company. We have shown graphs on inside cover page of Company''s growth in Sales, Profit and Value of shares as traded on March 31 of each year on BSE. The Milestone depiction also shows Progress of Company and its achievements since the inception. We have many more Miles to go and with continued support of all we hope to climb greater heights in years to come.

The Company thanks all its Customers for continuous support and faith in meeting their requirements. The Company''s personnel have worked as a team and continue to work for better tomorrow. The Company thanks its Bankers, Vendors, Government agencies for their continued support.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

As required under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report is enclosed as a part of this report.

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Report on Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Company Secretary in Practice pursuant has been included in the report. Your company has been practicing the principle of good Corporate Governance over the year. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

LISTING WITH STOCK EXCHANGES:

The Company confirms that it has paid the Annual Listing Fees for the year 2017-18 to BSE where the Company''s Shares are listed.

DEMATERIALISATION OF SHARES:

88.32% of the company''s paid up Equity Share Capital is in dematerialized form as on 31st March, 2017 and balance 11.68% is in physical form.

NUMBER OF BOARD MEETINGS HELD:

The Board of Directors duly met 4 times during the financial year from 1st April, 2016 to 31st March, 2017. The dates on which the meetings were held are as follows :

21st May, 2016, 30th July, 2016, 28th October, 2016 and 4th February, 2017.

DIRECTORS:

The Board of Directors are duly constituted. As per provisions of Companies Act, 2013 for retirement by rotation, all executive directors are now liable to retire by rotation.

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.

DIRECTORS RESPONSIBILITY STATEMENT:

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

a) In the preparation of the annual accounts for the year ended 31st March, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures;

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

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

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

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

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

COMMENTS ON AUDIT OBSERVATIONS:

With respect to the Statutory Auditors'' observations regarding dues of custom, please note that, the same have not been deposited by the company on account of dispute which is pending before Delhi High Court.

COMMENTS ON SECRETARIAL AUDITOR''S OBSERVATIONS:

There is no malafide intention on the part of company and delay if any, in the matter is inadvertently and caused due to oversight. The Company is in process of complying all the requirements of the Companies Act, 2013 and amended listing agreement.

AUDITORS:

Statutory Auditors:

As per Section 139 (2) of the Companies Act, 2013, M/s. Ajmera Ajmera & Associates, Chartered Accountants, Mumbai are not eligible to be re-appointed as Auditors of the Company since they have completed their term as Auditors of the Company. Board of Directors has recommended appointment of M/s. Ajay Shobha & Co. (Firm Registration No. 31703 IE), Chartered Accountants, Mumbai who are required to be appointed at this Annual General Meeting.

Secretarial Audit:

According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit Report submitted by Company Secretary in Practice is enclosed as a part of this report Annexure-A.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

a. CONSERVATION OF ENERGY:

The company''s operations do not involve substantial consumption of power in comparison to costs of production. However, regulatory measures are there to ensure that the consumption of power is within the norms.

b. TECHNOLOGY ABSORPTION:

The company has fully absorbed the technical know-how received from USA and Italy.

c. FOREIGN EXCHANGE EARNING AND OUTGO:

Foreign exchange earnings of the company during the year 2016-2017 were Rs. 667.10 Lacs (Previous Year Rs. 608.05 Lacs) while outgoings were Rs. 32.35 Lacs (Previous Year Rs. 2.82 Lacs).

VIGIL MECHANISM:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.smtgrinders.com under http://www.smtgrinders.com/policies link.

RELATED PARTY TRANSACTIONS:

Related party transactions that were entered during the financial year were on an arm''s length basis and were in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year as per Form AOC-2 is enclosed as Annexure-B.

The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules there under and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company at www.smtgrinders.com under http://www.smtgrinders.com/policies link.

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-C.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

There are no Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 during the current Financial Year.

REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in respect of employees of the Company and Directors is furnished hereunder:

S.

No.

Name

Designation

Remuneration paid FY 16-17

Remuneration paid FY 15-16

Increase in

remuneration

from

previous

year

Ratio/Times per Median of employee remuneration

1

Mr. Ashok

Sheth

Chairman

and

Managing

Director

Rs. 13,24,014/-

Rs. 10,63,223/-

Rs. 2,60,791/-

5.61

2

Mr. Hemendra Badani

Managing

Director

Rs. 13,77,097/-

Rs. 10,88,535/-

Rs. 2,88,562/-

5.84

3

Mr. Harsh Badani

Whole Time Director

Rs. 11,20,000/-

Rs. 8,64,101/-

Rs. 2,55,899/-

4.75

DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY:

The Company has been addressing various risks impacting the Company and the policy of the Company on risk management is provided elsewhere in this Annual Report in Management Discussion and Analysis.

PARTICULARS OF EMPLOYEES

Details of employees which are covered under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is as follows:

A. Top ten employees in terms of remuneration:

Name of Employee

Date of Commence ment

Date of resignation

Total Remunera tion paid

Qualification

and

experience

Designation / nature of Duties

Age

Last employment held by employee

Relation

with

Director

Ashok Sheth

10/09/1987

Rs.

13,24,014/-

B.S.-

Mechanical Engineering USA with 48 years of experience

Chairman and MD

69

N. A.

himself

Hemendra Badani

10/09/1987

Rs.

13,77,097/-

B.Com

Graduate with 43 years of experience

Vice

Chairman and MD

64

N. A.

himself

Harsh

Badani

31/01/2015

Rs.

11,20,000/-

B.E.-

Mechanical and MBA with 10 years of experience

WTD

32

N. A.

himself

NMB

Khan

15/06/1992

Rs.

6,79,279/-

Commerce Graduate with 33 years of experience

Compliance

Officer

54

KR

Kanakiya & Co.

N. A.

M. I. Gohil

01/04/2001

Rs.

5,05,185/-

ITI with 27 years of experience

Assembly

Manager

53

N. A.

N. A.

M. A. Bidiwala

09/11/1991

Rs.

5,02,110/-

DME with 26 years of experience

QC and

Development

Manager

45

N. A.

N. A.

Atul Modi

01/11/1996

Rs.

4,09,868/-

M.Com with 21 years of experience

Purchase

Officer

49

Geeta valves

N. A.

V. S. Uttekar

01/09/1991

Rs.

3,48,474/-

ITI with 26 years of experience

Sr. Assembly operator

49

N. A.

N. A.

V. D. Parmar

01/09/1991

Rs.

3,44,865/-

ITI with 26 years of experience

Sr. Machine

shop

operator

50

N. A.

N. A.

I. A. Patel

01/02/1996

Rs.

3,43,973/-

ITI with 21 years of experience

Sr. Marking and

Scheduler

50

Plastic

Pulverising

Mill

N. A.

B. Employed throughout the year under review & were in receipt of remuneration in aggregate of not less than Rs. 1, 02, 00,000/- p. a. or Rs. 8,50,000/- per month if employed for part of the year: N. A.

C. Person who are getting more remuneration than MD, WTD or manager and hold 2% or more equity shares together with spouse and dependent children: N. A.

INTERNAL FINANCIAL CONTROLS

Your Company has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business including adherence to the Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE

The Company has zero tolerance for sexual harassment at workplace, and has adopted a policy against sexual harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. The Company has not received any complaint of sexual harassment during the financial year 2016-17.

DETAILS OF FRAUDS REPORTED BY THE AUDITORS

No frauds have been reported by the auditors under sub-section 12 of section 143 of the companies Act, 2013.

ACKNOWLEDGEMENT:

Directors take this opportunity to express their thanks to various departments of the Central and State Government, Bankers, Material Suppliers, Customers and Shareholders for their continued support and guidance. The Directors wish to place on record their appreciation for the dedicated efforts put in by Employees of the Company at all levels.

For and on behalf of Board of Directors

ASHOK J SHETH

Chairman and Managing Director

DIN: 00174006

Place: Mumbai

Date: 13/05/2017


Mar 31, 2015

Dear members,

The Directors have pleasure in presenting before you the Twenty Third Annual Report of the Company together with the Audited Statements of Accounts for the year ended 31st March, 2015.

FINANCIAL RESULTS:

The performance during the period ended 31st March, 2015 has been as under:

(Rs. in Lacs) Particulars Year Year Year Ended Ended Ended 31st 31st 31st March, March, March, 2015 2014 2013

Sales (Net) 1079.42 923.08 1036.45

Other Income 15.44 20.66 14.71

Increase/ (Decrease) in stocks 150.75 84.90 57.00

Profit Before Taxation 104.63 58.52 141.85

Less:

Taxation 56.00 25.00 50.00

Fringe Benefit Tax - - -

Add/Less: Deferred Tax 26.08 3.70 1.11

Net Profit after Tax 62.94 37.21 88.17

Add: Profit brought Forward from 525.39 514.75 466.16 Previous Year

Profit available for appropriation 588.33 551.96 554.34

Proposed Dividend 34.06 22.71 34.07

Corporate Tax on Proposed Dividend 6.81 3.86 5.53

Transfer to General Reserve 0.00 0.00 0.00

Balance Carried to Balance Sheet 547.45 525.39 514.75

(Rs. in Lacs)

Particulars Year Year Ended Ended 31st 31st March, March, 2012 2011

Sales (Net) 1407.65 954.97

Other Income 15.21 7.38

Increase/ (Decrease) in stocks (32.02) (45.51)

Profit Before Taxation 192.41 136.62

Less:

Taxation 65.14 48.00

Fringe Benefit Tax - -

Add/Less: Deferred Tax 5.80 (6.63)

Net Profit after Tax 134.62 77.17

Add: Profit brought Forward from 417.13 392.93

Previous Year

Profit available for appropriation 551.75 470.11

Proposed Dividend 68.13 45.42

Corporate Tax on Proposed Dividend 11.05 7.54

Transfer to General Reserve 6.41 -

Balance Carried to Balance Sheet 466.16 417.14

DIVIDEND:

Your Directors recommend dividend of Rs. 34,06,632/- per share (7.5%) on 4542176 equity shares of Rs. 10/- each for the year ended March 31, 2015 subject to members' approval.

OPERATIONS:

The operation for the year has shown growth after two years of decline in Sales and profits. The market has started slow recovery for Machine Tools industry. The acceptability of our quality and service was recognized in International market and it resulted in higher exports. Export constituted close to 45 % of total sales of the year. During the year our Grinders were sold in Australia, New Zealand, China, Italy, UK and USA. This helped the company to show the growth and profitability for the year. There was some delay in taking delivery of the grinders ready with us by customers due to various reasons. This resulted in higher inventory. However, the delayed consignments are now cleared and would help improve results for the current financial year.

The total sales were up by about 17 % to Rs. 1079.42 Lacs against previous year's sales of Rs. 923.07 Lacs. The net profit also increased by about 69 % to Rs. 62.94 lacs against previous year's Rs. 37.20 lacs.

Your company has been able to remain Debt Free for the year. The borrowings from bank are in Cash Credit account. The company has earned more from Bank deposits than the interest paid to banks.

The New Year has started with good orders in hand and general optimism in the industry for higher growth in future. The expected growth in Infrastructure, Defense, Aerospace and Energy sector would help in having more disposable income in hands of working people. This normally results in higher sales in Automotive and Engineering industry. Similarly exports of automotive and other components has seen higher demand and resulted in higher exports in time to come. On Export Front also your Company has orders in hands from Brazil, Argentina, UK and USA. More orders are expected from other export markets. The Domestic Front is also looking up.

EEPC has recognized the Export efforts of Your Company and has awarded Star Performer for the Year 2012 -2013 for western region. The award was handed over by Gujarat Chief Minister, Mrs. Anandiben Patel to Mr. Harsh Badani in Ahmedabad.

The company has been able to reduce the input cost by about 1 % during the year inspite of higher cost in some area of procurement and higher cost of import due to depreciation of Rupee. The total cost was reduced by about 4 % by curtailing expenses. Further cuts in expenses are being planned to improve the working.

The Company had participated in IMTEX 2015 at Bangalore in January 2015. The Micro Centerless Grinder and Double Disk Grinder were launched at the exhibition. The response to new as well as existing product range was good. The first Micro Centerless grinder is being tooled up for a tiny medical implement component and is expected to be supplied to an Export Oriented customer. The company is developing another model for Engine valve industry and it expects to have orders for the same in current and future years. The continuous Development activity has helped Your Company to stay ahead of competition and compete with International manufacturers in Europe, USA, Japan etc.

The Company continued it's social responsibility as far as possible with it's own resources.

The company thanks it's customers for continuous support and faith in meeting their requirements. The Company's personnel have worked hard to achieve these targets and work for better future. The Company thanks it's Bankers and all other agencies for their continued support.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

As required under Clause 49 of the Listing Agreements with Stock Exchanges, the Management Discussion and Analysis Report is enclosed as a part of this report.

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Report on Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Company Secretary in Practice pursuant to clause 49 of the Listing Agreement with the Stock Exchanges has been included in the report. Your company has been practicing the principle of good Corporate Governance over the year. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

LISTING WITH STOCK EXCHANGES:

The Company confirms that it has paid the Annual Listing Fees for the year 2015-16 to BSE where the Company's Shares are listed.

DEMATERIALISATION OF SHARES:

84.94% of the company's paid up Equity Share Capital is in dematerialized form as on 31st March, 2015 and balance 15.06% is in physical form.

NUMBER OF BOARD MEETINGS HELD:

The Board of Directors duly met 4 times during the financial year from 1st April, 2014 to 31st March, 2015. The dates on which the meetings were held are as follows:

10th May, 2014, 2nd August, 2014, 1st November, 2014 and 31st January, 2015.

DIRECTORS:

The Board of Directors are duly constituted. As per provisions of Companies Act, 2013 for retirement by rotation, all executive directors are now liable to retire by rotation.

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.

DIRECTORS RESPONSIBILITY STATEMENT:

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

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

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

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

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

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

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

COMMENTS ON AUDIT OBSERVATIONS:

With respect to the Statutory Auditors' observations regarding dues of custom, please note that, the same have not been deposited by the company on account of dispute which is pending before Delhi High Court.

COMMENTS ON SECRETARIAL AUDITOR'S OBSERVATIONS:

There is no malafide intention on the part of company and delay if any, in the matter is inadvertently and caused due to oversight. The Company is in process of complying all the requirements of the Companies Act, 2013 and amended listing agreement.

AUDITORS:

Statutory Auditors:

The Auditors, M/s. Ajmera Ajmera & Associates, Chartered Accountants, Mumbai retire at this Annual General Meeting and being eligible, offer themselves for reappointment.

Secretarial Audit :

According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit Report submitted by Company Secretary in Practice is enclosed as a part of this report Annexure-A.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

a. CONSERVATION OF ENERGY:

The company's operations do not involve substantial consumption of power in comparison to costs of production. However, regulatory measures are there to ensure that the consumption of power is within the norms.

b. TECHNOLOGY ABSORPTION:

The company has fully absorbed the technical know-how received from USA and Italy.

c. FOREIGN EXCHANGE EARNING AND OUTGO:

Foreign exchange earnings of the company during the year 2014-2015 were Rs. 490.84 Lacs (Previous Year Rs. 292.89 Lacs) while outgoings were Rs. 0.74 Lacs (Previous Year Rs. 1.88 Lacs).

VIGIL MECHANISM:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.smtgrinders.com under http://www.smtgrinders.com/policies link.

RELATED PARTY TRANSACTIONS:

Related party transactions that were entered during the financial year were on an arm's length basis and were in the ordinary course of business. There were no materially significant related party transactions with the Company's Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year as per Form AOC-2 is enclosed as Annexure-B.

The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules there under and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company at www.smtgrinders.com under http://www.smtgrinders.com/policies link.

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-C.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

There are no Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 during the current Financial Year.

REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in respect of employees of the Company and Directors is furnished hereunder:

S. Name Designation Remuneration No. paid FY 14-15

1 Mr. Ashok Chairman Rs. 10,58,502/- Sheth and Managing Director

2 Mr. Hemendra Managing Rs. 10,54,310/- Badani Director

3 Mr. Harsh Whole Time Rs. 7,10,265/- Badani Director

S. Name Remuneration Increase in Ratio/Times No. paid FY 13-14 remuneration per Median from of employee previous remuneration year

1 Mr. Ashok Sheth Rs. 10,35,000/- Rs. 23,502/- 5.75



2 Mr. Hemendra Badani Rs. 9,52,000/- Rs. 1,02,310/- 5.73



3 Mr. Harsh Badani Rs. 5,84,000/- Rs. 1,26,265/- 3.86

DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY:

The Company has been addressing various risks impacting the Company and the policy of the Company on risk management is provided elsewhere in this Annual Report in Management Discussion and Analysis.

ACKNOWLEDGEMENT:

Directors take this opportunity to express their thanks to various departments of the Central and State Government, Bankers, Material Suppliers, Customers and Shareholders for their continued support and guidance. The Directors wish to place on record their appreciation for the dedicated efforts put in by Employees of the Company at all levels.

For and on behalf of Board of Directors

ASHOK J SHETH Chairman and Managing Director DIN: 00174006

Place: Mumbai Date: 17/06/2015


Mar 31, 2013

TO THE MEMBERS: The Directors have pleasure in presenting 21st Annual Report of your company together with the Audited Accounts for the year ended March 31, 2013. FINANCIAL RESULTS: The financial results of the company for the year under review with comparison thereof with last four year's results are summarized below: (Rs. in Lacs) Particulars Year Year Year Year Year Ended Ended Ended Ended Ended 31st 31st 31st 31st 31st March, March, March, March, March, 2013 2012 2011 2010 2009 Sales (Net) 1036.45 1407.65 954.97 626.41 757.05 Other Income 14.71 15.21 7.38 12.42 17.64 Increase/(Decrease) in stocks 57.00 (32.02) (45.51) (38.02) 131.75 Cash Profit Before Depreciation 207.34 278.58 210.59 97.24 163.25 and Taxation Less: Depreciation 65.49 75.43 71.17 68.81 64.73 Taxation 50.00 65.00 48.02 6.50 30.00 Fringe Benefit Tax - - 2.00 Add/Less: Deferred Tax 1.11 5.80 (6.63) 4.83 3.59 Net Profit after Tax 88.17 134.62 77.17 17.14 62.22 Add: Profit brought Forward from 466.16 417.13 392.93 375.79 313.56 Previous Year Profit available for appropriation 554.34 551.75 470.11 392.93 375.79 Proposed Dividend 34.07 68.13 45.42 - - Corporate Tax on Proposed 5.53 11.05 7.54 - - Dividend Transfer to General Reserve 0.00 6.41 - - - Balance Carried to Balance Sheet 514.75 466.16 417.13 392.93 375.79 DIVIDEND: Your Directors recommend dividend of Rs. 0.75/- per share (7.50%) on 45,42,176 equity shares of Rs. 10/- each for the year ended March 31, 2013 subject to members' approval. OPERATIONS: The operation for the year has shown decline in sales and profit. The Capital Goods industry has slowed down substantially in past year due to slow down in Infrastructure projects and Automotive industry. Machine Tools are heavily dependent on Automotive industry and India had seen first time decline in vehicle production in almost a decade. The total net sales has declined by about 26 % to Rs. 1036.45 Lacs against previous year Rs. 1407.65 Lacs. The net profit has also declined by about 34 % from Rs. 134.62 Lacs to Rs. 88.17 Lacs. The decline was principally due to the fact that some of the customers did not pick up their ordered machines in time. In spite all this downturn in the year, your company has still remained Debt Free except small loans in Cash Credit account. The prospect for current financial year has been steadily improving. We have about six months orders in hand. Our sales of machines to USA will grow from 13 grinders in last financial year to over 20 grinders in current financial year. We have also started small parts exports to U.K. and it is slowly growing. Efforts are continuing to explore markets, in Argentina, Brazil, Malaysia, Turkey and New Zealand. The inquiry for machines has grown in last 3 months and it gives us hope that there will be upturn in coming few months. During the last year, the company entered in to Technical Klnow how agreement with an Italian company, Laboratorio Eccellenza Italiana for development of CNC Double Disk Grinder. A conceptual photo is on last inner page of this report. Double disk grinders are used in mass production of components like Bearings, Piston Pins, Connecting rods, U J Cross, Engine valves and variety of automotive and engineering components. The development work is in progress and first grinder is expected to be ready for trials in September 2013. . The slowdown in work was also used by our Engineering colleagues to start development activity for other grinders to augment our capability to serve wider industry group and also use available manufacturing capacity to meet future demand from all sectors. A MICRO Centerless grinder is being developed to grind components used in Medical Implement field and this requirement is currently being met by imports from Europe and USA. One of the major Automotive industry segment being served by the company is Engine Valve and practically entire grinding operation in this manufacturing are being met by Solitaire. One of the operation of grinding was not feasible with Centerless grinding. The new process and grinder is being developed to meet with this requirement. The company has been able to maintain the raw material and manufacturing cost in line of the sales. The inventory has grown due to non-shipment of the machines to customers. The company in the year distributed funds to Employees children's education as part of our Corporate Social Responsibility. The company thanks its customers for continuous support and help to improve quality, service and capability to do better for the future. The company's personnel have worked with zeal to meet the growing expectations of customers. The company thanks its bankers for continued support during the year. DIRECTORS: Mr. Anil J. Kothari, Director and Dr. Amita S. Shah, Director of the company are liable to retire by rotation being eligible, offers themselves for re-appointment. The Board recommends their reappointment. The Board of Directors is duly constituted. DIRECTORS RESPONSIBILITY STATEMENT AS REQUIED UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956: The Directors state: i) That in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to the material departures. ii) That the directors have 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 at the end of.the financial year and of the profit and loss of the Company for that period. iii) That the directors have 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) That the directors have prepared the annual accounts on a going concern basis. CORPORATE GOVERNANCE: Report on Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Company Secretary in Practice pursuant to clause 49 of the Listing Agreement with the Stock Exchanges has been included in the report. Your company has been practicing the principle of good Corporate Governance over the year. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNING AND OUTGO: a. CONSERVATION OF ENERGY: The company's operations do not involve substantial consumption of power in comparison to costs of production. However, regulatory measures are there to ensure that the consumption of power is within the norms. b. TECHNOLOGY ABSORPTION: The company has fully absorbed the technical know-how received from USA and Italy. c. FOREIGN EXCHANGE EARNING AND OUTGO: Foreign exchange earnings of the company during the year 2012-2013 were Rs. 135.07 Lacs (Previous Year Rs. 359.64 Lacs) while outgoings were Rs. 3.59 Lacs (Previous Year Rs. 60.15 Lacs). MANAGEMENT DISCUSSION AND ANALYSIS REPORTS: The Management Discussion and Analysis on Company's Performance industry trends and other material changes with respect to company wherever applicable are annexed hereto and forms part of the report. AUDITORS: , M/s Ajmera Ajmera & Associates, Chartered Accountants, Mumbai hold their office until the conclusion of the ensuing Annual General meeting and are eligible for reappointment. The members are requested to re-appoint them as Auditors of the Company till the conclusion of the next Annual General meeting. COMPLIANCE CERTIFICATE: The secretarial compliance certificate pursuant to the provision of Sec. 383A(1) of the Act, is obtained from Mr. Sachin Chhadawa, Practicing Company Secretary, Mumbai and is attached herewith for your kind perusal and forms part of this Director's Report. COST AUDIT CERTIFICATE: The cost audit certificate pursuant to the provision of Sec 209 (1) (d) of the Companies Act, 1956. is obtained from Mr H R Kapadia, a practicing Cost Accountant, Vadodara. FIXED DEPOSIT: During the financial year under consideration, the Company had not accepted nor renewed any deposits from public within the meaning of Section 58-A of the Companies Act, 1956. PARTICULARS OF EMPLOYEES: None of the employees are drawing salary whose particulars are to be included in the Directors' Report as required u/s 217(2 A) of the Companies Act, 1956. PERSONNEL & INDUSTRIAL RELATIONS: Relations with all employees were cordial and congenial atmosphere prevailed. Your Directors acknowledge the committed efforts of the employees at all levels and their satisfying contribution in management and company affairs. INSURANCE: Your Company continued to cover all assets mainly; plant & machinery, building, materials, furniture & fixtures, employees, for the possible risks like fire, flood, public liability, break- down, terrorism, Earthquake and accidents. INVESTOR EDUCATION AND PROTECTION FUND: The Company has transferred Rs. 143,043/- to Investor Education and Protection Fund during the year under review. ACKNOWLEDGEMENT: Your Director's take this opportunity to thank the customers, shareholders, suppliers, bankers, financial institutions, and central and state government for their continued support to the company. BY ORDER OF THE BOARD ASHOK J SHETH Place: Mumbai Chairman Date: 04.05.2013


Mar 31, 2012

The Directors have pleasure in presenting 20th Annual Report of your company together with the Audited Accounts for the year ended March 31,2012.

FINANCIAL RESULTS:

The financial results of the company for the year under review with comparison thereof with last four year's results are summarized below:

(Rs. in Lacs)

Particulars Year Year Year Year Year Ended Ended Ended Ended Ended 31st 31st 31st 31st 31st March, March, March, March, March, 2012 2011 2010 2009 2008

Sales (Net) 1407.65 954.97 626.41 757.05 883.48

Other Income 16.40 7.38 12.42 17.64 15.45

Increase/ (Decrease) in stocks (32.02) (45.51) (38.02) 131.75 (25.49)

Cash Profit Before Depreciation 278.58 210.59 97.24 163.25 242.92 and Taxation

Less: Depreciation 75.43 71.17 68.81 64.73 59.61

Taxation 65.00 48.02 6.50 30.00 57.00

Fringe Benefit Tax - - - 2.00 1.62

Add/Less: Deferred Tax 5.80 (6.63) 4.83 3.59 6.59

Net Profit after Tax 134.62 77.17 17.14 62.22 118.41

Add: Profit brought Forward from 417.13 392.93 375.79 313.56 245.01 Previous Year

Profit available for appropriation 551.75 470.11 392.93 375.79 363.42

Proposed Dividend 68.13 45.42 - - 34.06

Corporate Tax on Proposed 11.05 7.54 - - 5.79 Dividend

Transfer to General Reserve 6.41 - - - 10.00

Balance Carried to Balance Sheet 466.16 417.13 392.93 375.79 313.56

DIVIDEND:

Your Director's recommends dividend of Rs. 1.50 per share (15 %) on 45,42,176 equity shares of Rs. 10/- each for the year ended March 31,2012 subject to member's approval.

OPERATIONS:

The operation of the year has shown growth in terms of Sales and Net Profit. The Indian economy for Capital Goods has slowed down in recent months. However, your company did not have any serious impact on order execution or booking.

The total sales has grown by 45 % to Rs. 1539.75 lacs from previous year of Rs.1064.94 lacs. The net profit has grown by over 74% from Rs.77.17 lacs to Rs. 134.62 lacs. Export Sales has grown from Rs.68 lacs to Rs.360 lacs.

The company has paid back all its Term Loan to the bank during the year. The company is now "Debt free".

The prospect for current financial year are bright with order booking for first six months at the time of beginning of the year. Your company is also making efforts to export machines to various countries.

During the year, the company developed Bocca R 50 CNC Centerless grinder. A Line of two grinders were supplied to Lakshmi Machine Works, Coimbatore. The machines were highly automated and developed with state of the art technology.

During the current year, the company will be exhibiting machines at IMTEX 2013 in Bangalore in the month of January. New products and attachments will be launched at IMTEX.

The company has been able to maintain the raw material and manufacturing cost at lower percentage of sales inspite of increase in raw material prices and all other expenses. The inventory management and cost rationalization has helped to maintain the cost of manufacturing.

The company has adopted an Anganwadi school renovation as part of its social commitment to the community (Corporate Social Responsibility Initiative). The company expects to take up more such projects in current year.

The company thanks its customers, for continuous support and help to improve quality and productivity of the machines for better utilization.

The company's personnel have worked diligently to meet the growing demand. The result of their efforts can be seen with the growth in the business.

The company thanks its bankers for excellent support during the year.

DIRECTORS:

Ms. Padmaja K. Mukundan, Director and Ms. Shilpa Taneja, Director of the company are liable to retire by rotation being eligible, offers themselves for re-appointment. The Board recommends their reappointment. The Board of Directors is duly constituted.

DIRECTORS RESPONSIBILITY STATEMENT AS REQUIED UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956:

The Directors state:

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

ii) That the Directors have 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 at the end of the financial year and of the profit and loss of the Company for that period.

iii) That the Directors have 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) That the Directors have prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

Report on Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Company Secretary in Practice pursuant to clause 49 of the Listing Agreement with the Stock Exchanges has been included in the report. Your company has been practicing the principle of Good Corporate Governance over the year. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNING AND OUTGO:

a. CONSERVATION OF ENERGY:

The company's operations do not involve substantial consumption of power in comparison to costs of production. However, regulatory measures are there to ensure that the consumption of power is within the norms.

b. TECHNOLOGY ABSORPTION:

The company has fully absorbed the technical know-how received from USA and Italy,

c. FOREIGN EXCHANGE EARNING AND OUTGO:

Foreign exchange earnings of the company during the year 2011-2012 were Rs. 359.64 Lacs (Previous Year Rs. 67.92 Lacs) while outgoings were Rs. 60.15 Lacs (Previous Year Rs. 0.16 Lacs).

MANAGEMENT DISCUSSION AND ANALYSIS REPORTS:

The Management Discussion and Analysis on Company's Performance industry trends and other material changes with respect to company wherever applicable are annexed hereto and forms part of the report.

AUDITORS:

M/s Ajmera Ajmera & Associates, Chartered Accountants, Mumbai hold their office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The members are requested to re-appoint them as Auditors of the Company till the conclusion of the next Annual General meeting.

COMPLIANCE CERTIFICATE:

The secretarial compliance certificate pursuant to the provision of Sec. 383A(1) of the Act, is obtained from Mr. Sachin Chhadawa, Practicing Company Secretary, Mumbai and is attached herewith for your kind perusal and forms part of this Director's Report.

FIXED DEPOSIT:

During the financial year under consideration, the Company had not accepted nor renewed any deposits from public within the meaning of Section 58-A of the Companies Act, 1956.

PARTICULARS OF EMPLOYEES:

None of the employees are drawing salary whose particulars are to be included in the Directors' Report as required u/s 217(2A) of the Companies Act, 1956.

PERSONNEL & INDUSTRIAL RELATIONS:

Relations with all employees were cordial and congenial atmosphere prevailed. Your Directors acknowledge the committed efforts of the employees at all levels and their satisfying contribution in management and company affairs.

INSURANCE:

Your Company continued to cover all assets mainly; plant & machinery, building, materials, furniture & fixtures, employees for the possible risks like fire, flood, public liability, break-down, terrorism, Earthquake and accidents.

INVESTOR EDUCATION AND PROTECTION FUND:

The Company has transferred Rs. 67,769/- to Investor Education and Protection Fund during the year under review.

ACKNOWLEDGEMENT:

Your Director's take this opportunity to thank the customers, shareholders, suppliers, bankers, financial institutions, and central and state government for their continued support to the company.

BY ORDER OF THE BOARD

ASHOK J. SHETH

Place: Vadodara Chairman

Date : 28/4/2012


Mar 31, 2011

The Directors have pleasure in presenting 19th Annual Report of your company together with the Audited Accounts for the year ended March 31st,2011.

FINANCIAL RESULTS:

The financial results of the company for the year under review are summarized below:

Particulars (Rs. in Lacs) (Rs. in Lacs) Year Ended Year Ended March 31, March 31, 2011 2010

Sales (Net) 954.97 626.41

Other Income 7.37 12.42

Increase/(Decrease) in stocks (45.50) (38.02)

Cash Profit Before Depreciation & Taxation 210.59 97.24

Less : Depreciation 71.16 68.81

: Taxation 48.00 6.5

: Fringe Benefit Tax

Add/Less: Deferred Tax (6.62) 4.83

Net Profit after Tax 77.17 17.14

Add: Profit brought Forward from 392.93 375.79 Previous year

Profit available for appropriation 470.10 392.93

Proposed Dividend 45.42 -

Corporate Tax on Proposed Dividend 7.54 -

Transfer to General Reserve - -

Balance Carried to Balance Sheet 417.13 392.93

DIVIDEND:

Your directors recommend dividend of Rs. 1/-per share (10%) on 4542176 equity shares of Rs. 10/-each for the year ended March 31,2011 subject to members approval.

OPERATIONS:

The operation for the current year has shown growth in terms of Sales & Net Profit. The Indian economy is growing at unprecedented level and same is being reflected in the performance of your company.

The total sale has grown by 54% to Rs. 1060.94 lacs from previous year of Rs.685.80 lacs. The Net Profit has grown by over 300 % from Rs. 17.14 lacs to Rs.75.17 lacs.

The prospects for current financial year are also bright with good order booking for the first 6 to 7 months at the beginning of the year. The company has been able to make breakthrough in exports by receiving orders from Australia and Turkey besides regular orders from USA. Negotiations are also being made now to manufacture machines for Bocca & Malandrone Sunebo S.p.A for European market.

During the year company has now developed 5 Axis CNC Centerless Grinder and a line of 3 Grinders was supplied to Rane Engine Valve, Trichy. During the current year, similar lines of high quality grinders are being manufactured to meet customers demand.

During the year company had exhibited several grinders at IMTEX 2011. The response was positive and new inquiries were generated and several orders have been received.

The company has been able to maintain the raw material and manufacturing cost at lower percentage of sales inspite of increase in raw material prices and all other expenses. The inventory management and cost rationalization has helped to main the cost of manufacturing.

The company thanks its customers for continuous support and help improve quality and productivity of the machines for better utilization.

The companys personnel have worked diligently to meet the growing demand. The results of their efforts can be seen with the growth in the business.

The company thanks its bankers for excellent support during the year.

DIRECTORS:

Dr. Amita S.Shah, Director and Ms. Rashmi Desai, Director of the company are liable to retire by rotation being eligible, offers themselves for re-appointment. The Board recommends their reappointment. The Board of Directors is duly constituted.

DIRECTORS RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956:

The Directors state:

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

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

iii) That the directors have 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.

That the directors have prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

Report on Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Company Secretary in Practice pursuant to clause 49 of the Listing Agreement with the Stock

Exchanges has been included in the report. Your company has been practicing the principle of good Corporate Governance over the year. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNING AND OUTGO:

a. CONSERVATION OF ENERGY:

The companys operations domot involve substantial consumption of power in comparison to costs of production. However, regulatory measures are there to ensure that the consumption of power is within the norms.

b. TECHNOLOGY ABSORPTION:

The company has fully absorbed the technical know-how received from USA and Italy.

c. FOREIGN EXCHANGE EARNING AND OUTGO:

Foreign exchange earnings of the company during the year 2010-2011 were Rs. 67.92 Lacs (Previous Year Rs. 59.93 Lacs) while outgoings were Rs. 0.16 Lacs (Previous Year Rs. 5.28 Lacs).

MANAGEMENT DISCUSSION AND ANALYSIS REPORTS:

The Management Discussion and Analysis on Companys Performance industry trends and other material changes with respect to company wherever applicable are annexed hereto and forms part of the report.

AUDITORS:

M/s Ajmera Ajmera & Associates, Chartered Accountants, Mumbai hold their office until the conclusion of the ensuing Annual General meeting and are eligible for reappointment. The members are requested to re- appoint them as Auditors of the Company till the conclusion of the next Annual General meeting.

COMPLIANCE CERTIFICATE:

The secretarial compliance certificate pursuant to the provision of Sec. 3 83 A( 1) of the Act, is obtained from Mr. Sachin Chhadawa, Practicing Company Secretary, Mumbai and is attached herewith for your kind perusal and forms part of this Directors Report.

FIXED DEPOSIT:

During the financial year under consideration, the Company had not accepted nor renewed any deposits from public within the meaning of Section 5 8-Aof the Companies Act, 1956.

PARTICULARS OF EMPLOYEES:

None of the employees are drawing salary whose particulars are to be included in the Directors Report as required u/s 217(2 A) of the Companies Act, 1956.

PERSONNEL & INDUSTRIAL RELATIONS:

Relations with all employees were cordial and congenial atmosphere prevailed. Your Directors acknowledge the committed efforts of the employees at all levels and their satisfying contribution in management and company affairs.

INSURANCE:

Your Company continued to cover all assets mainly; plant & machinery, building, materials, furniture & fixtures, employees for the possible risks like fire, flood, public liability, break-down, terrorism, Earthquake and accidents.

INVESTOR EDUCATION AND PROTECTION FUND:

The Company has not required to transfer any amount to Investor Education and Protection Fund during the year under review.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, financial institutions, and central and state government for their continued support to the company.

BY ORDER OF THE BOARD

ASHOKJ.SHETH Chairman

Place: Mumbai Date: 14/05/2011


Mar 31, 2010

The Directors have pleasure in presenting 18th Annual Report of your company together with the Audited Accounts for the year ended March 31,2010.

FINANCIAL RESULTS:

The financial results of the company for the year under review with comparison thereof with last four years results are summarized below:

(Rs. in Lacs) Particulars Year Year Year Year Year Ended Ended Ended Ended Ended 31st 31st 31st 31st 31st March March March March March 2010 2009 2008 2007 2006 Sales (Net) 626.41 757.05 883.48 702.63 545.08 Other Income 12.42 17.64 15.45 12.57 7.26 Increase/(Decrease) in stocks (38.02)131.75 (25.49) 32.55 23.24 Cash Profit Before Depreciation and Taxation 97.24 163.25 242.92 188.94 156.89 Less: Depreciation 68.81 64.73 59.61 44.60 39.68 Taxation 6.50 30.00 57.00 45.00 45.00 Fringe Benefit Tax - 2.00 1.62 1.54 0.95 Add/Less: Deferred Tax 4.83 3.59 6.59 2.75 10.27 Net Profit after Tax 17.14 62.22 118.41 101.01 81.53 Add: Profit brought Forward from Previous Year 375.79 313.56 245.01 185.84 139.20 Profit available for appropriation 392.93 375.79 363.42 286.85 220.73 Proposed Dividend - - 34.06 27.25 22.71 Corporate Tax on Proposed Dividend - - 5.79 4.59 3.19 Transfer to General Reserve - - 10.00 10.00 9.00 Balance Carried to Balance Sheet 392.93 375.79 313.56 245.01 185.84

DIVIDEND:

In view of the uncertainty prevailing in the Industry and decline in profits due to recession in last year, your board has considered it prudent to not recommend the dividend for the year under review.

OPERATIONS:

The operations for the current year have not kept pace with the industry. The downward trend was based on Export market. The export to USA had gone down by almost 62% in current year due to down turn in demand. The severe recession in Europe also did not help, as we could not get any orders from customers, as was envisaged earlier.

The other factors contributing to down ward trend was non co operation by some of our employees during the last quarter of the year. This resulted in loss of production and sales. The issues are b^ing resolved for better co operation in current year and future.

We were still req uired to hold inventory of some of the special purpose grinders built for customers and not picked up by them, due tothcir own problems. The order value of such grinders approximates to Rs. 1.25 crores.

The company was able to reduce the inventories with proper controls on purchase and better utilization of resources. No major capital expenses were made, as the company had built enough capacity in terms of building and equipment in previous years. The cost rationalization at various stages of manufacturing was implemented to improve on productivity.

The company thanks its customers and suppliers for excellent support provided in the current year.

The company also received excellent support from its bankers to tide over the difficult times in past two years.

The company has started the current year with pending orders of about Rs.5.00 crores and as industrial growth is foreseen, the company can expand its sales in current year. In January 2011, company will participate in IMTEX 2011 exhibition in Bangalore and hope to receive good response from customers in India and abroad.

DIRECTORS:

Ms. Shilpa Taneja, Director and Mr. A. J. Kothari, Director of the company are liable to retire by rotation being eligible, offers themselves for re-appointment. The Board recommends their reappointment. The Board of Directors is duly constituted.

DIRECTORS RESPONSIBILITY STATEMENT AS REQUIED UNDER SECTION 217(2AA) OF THE COMPANIES ACT, 1956:

The Directors state:

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

ii) That the directors have 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 at the end of the financial year and of the profit and loss of the Company for that period.

iii) That the directors have 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) That the directors have prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

Report on Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Company Secretary in Practice pursuant to clause 49 of the Listing Agreement with the Stock Exchanges has been included in the report. Your company has been practicing the principle of good Corporate Governance over the year. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNING AND OUTGO:

a. CONSERVATION OF ENERGY:

The companys operations do not involve substantial consumption of power in comparison to costs of production. However, regulatory measures are there to ensure that the consumption of power is within the norms.

b. TECHNOLOGYABSORPTION:

The company has fully absorbed the technical know-how received from USA and Italy.

MANAGEMENT DISCUSSION AND ANALYSIS REPORTS:

The Management Discussion and Analysis on Companys Performance industry trends and other material changes with respect to company wherever applicable are annexed hereto and forms part of the report.

AUDITORS:

M/s Ajmera Ajmera & Associates, Chartered Accountants, Mumbai hold their office until the conclusion of the ensuing Annual General meeting and are eligible for reappointment. The members are requested to re-appoint them as Auditors of the Company till the conclusion of the next Annual General meeting.

COMPLIANCE CERTIFICATE:

The secretarial compliance certificate pursuant to the provision of Sec. 383A(1) of the Act, is obtained from Mr. Sachin Chhadawa, Practicing Company Secretary, Mumbai and is attached herewith for your kind perusal and forms part of this Directors Report.

FIXED DEPOSIT:

During the financial year under consideration, the Company had not accepted nor renewed any deposits from public within the meaning of Section 58-Aof the Companies Act, 1956.

PARTICULARS OFEMPLOYEES:

None of the employees are drawing salary whose particulars are to be included in the Directors Report as required u/s 217(2A) ofthe CompaniesAct, 1956.

PERSONNEL & INDUSTRIAL RELATIONS:

Relations with employees were cordial. However, certain sections of employees have not contributed as much as required of them. Your Directors expects better commitment of the employees at all levels and their satisfying contribution in management and company affairs.

INSURANCE:

Your Company continued to cover all assets mainly; plant & machinery, building, materials, furniture & fixtures, employees for the possible risks like fire, flood, public liability, break-down, terrorism, Earthquake and accidents.

INVESTOR EDUCATION AND PROTECTION FUND:

The Company has not required to transfer any amount to Investor Education and Protection Fund during the year under review.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, financial institutions, and central and state government for their continued support to the company.

BY ORDER OF THE BOARD A.J.SHETH Place: Vadodara Chairman Date: 22nd May, 2010

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