Home  »  Company  »  Sutlej Textiles & In  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of Sutlej Textiles & Industries Ltd.

Mar 31, 2015

Dear members,

The Directors are pleased to present their Tenth Annual Report on the business and operations of your Company alongwith the audited financial statements for the year ended 31st March, 2015.

1. Financial Results

Financial Results of the Company for the year under review alongwith the figures for previous year are as follows :

1.1 Highlights of Performance

* Revenue from operations (Gross) stood at Rs. 187,858.42 Lakhs as compared to Rs. 188,390.37 Lakhs in FY 2013-14;

* Profit before Tax for the FY 2014-15 was Rs. 14,822.31 Lakhs

as compared to Rs. 17,172.63 Lakhs in FY 2013-14;

* Profit after tax for the FY 2014-15 was Rs. 11,545.90 Lakhs as compared to Rs. 13,137.81 Lakhs in FY 2013-14.

1.2 Financial Results

(Rs. in lakhs) Particulars

Revenue from Operations (Gross) 187,858.42 188,390.37

Gross Profit 21,881.21 24,754.98

Less: Depreciation, Impairment and Amortisation Expenses 6,990.73 7,518.62

Exceptional Item 68.17 63.73

Taxation:

- Current 3,155.00 3,589.00

- MAT Credit (entitlement)/ Utilised (300.00) 766.00

- Earlier years (2.38) (7.68)

- Deferred (net) 423.79 (312.50)

Profit after Tax 11,545.90 13,137.81

Add: Balance brought forward from the previous year 32,304.60 22,100.16

Profit available for appropriation 43,850.50 35,237.97

Appropriations:

Proposed dividend 1,638.29 1,310.63

Corporate dividend tax 333.52 222.74

Transfer to the general reserve 1,200.00 1,400.00

Balance in statement of profit and loss 40,678.69 32,304.60

TOTAL 43,850.50 35,237.97

The Company proposes to transfer an amount of Rs. 1,200.00 Lakh to the General Reserves. An amount of Rs. 40,678.69 Lakh is proposed to be retained in the Statement of Profit and Loss.

2. Dividend

Your Directors are pleased to recommend dividend of Rs. 10/- per share for the year ended 31st March, 2015, subject to shareholders' approval at the forthcoming Annual General Meeting. The total amount of dividend to be paid to the shareholders will be Rs. 1,972 lakhs (inclusive of dividend tax).

3. Share Capital

The paid up Equity Share Capital as on March 31, 2015 was Rs. 1,638.29 lakhs comprising of 16382862 Equity Shares of Rs. 10/- each. During the year under review, the Company has not issued any further shares to the members or general public.

4. Finance

4.1 Cash and cash equivalents as at 31st March, 2015 was Rs. 222.74 Lakh. The company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept under strict check through a process of continuous monitoring.

4.2 Rating

Your Company rating was upgraded as under:

i. CARE A (Single A Plus) for Long-Term Bank facilities (Term Loan) from CARE A- (Single A Minus) signifying adequate degree of safety regarding timely servicing of financial obligations and such instruments carry low credit risk &

ii. CARE A1 (A One Plus) for short term bank facilities (Fund based and Non-Fund based) from Care A2 (A Two Plus) signifying a very strong degree of safety regarding timely payment of financial obligations and such instruments carry lowest credit risk.

4.3 Deposits

The Company has discontinued its Fixed Deposit Scheme with effect from 31st March, 2014 and has not accepted Deposits from the public falling within the ambit of Chapter V of the Companies Act, 2013. As on March 31, 2015, there were no unclaimed/outstanding deposits or accrued interest with respect to deposits.

4.4 Particulars of Loans, Guarantees or Investments

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

5. Expansions and Acquisition, and other Capital Projects

The financial year under review witnessed a great deal of expansion activities carried out by your company through organic as well as inorganic means. The details of the expansion projects are given as under:

5.1. Expansion of Operations at Damanganga Home Textiles, Daheli, Bhilad

Your Company is expanding the operations at one of its units viz, Damanganga Home Textiles, Daheli, Bhilad, Gujarat at a cost of Rs. 88.50 crore. The project is under implementation and will be completed in the beginning of FY 2016-17. The same will result in increasing its capacity in existing facility to 9.6 Mn metres p.a from 2.5 Mn metres p.a. The expansion of operations in Home Textile Division will ensure further strengthening of Company's end to end operations from Yarn to Home Textile.

5.2 Cotton Melange Expansion Project at CTM, Kathua

Your Company has successfully completed expansion of its Kathua Unit by 31,104 spindles to manufacture value added cotton melange and cotton blended dyed yarn and commenced commercial production w.e.f 1st Nov 2014. Post this expansion, the Company's total yarn spinning capacity stands at 293,736 spindles, of which 96,720 spindles are utilized to make Cotton Melange and cotton blended dyed yarn. The rest of the spindles are utilized towards manufacturing mainly of synthetic dyed yarns. The addition of the new capacity will enable the Company to further strengthen its position as a leading player in the niche Cotton Melange and cotton blended dyed segment.

5.3 Expansion and modernisation

5.3.1 The Company has decided to expand its Unit Rajasthan Textile Mills, Bhawanimandi (Raj.) by 31,104 spindles to manufacture Cotton Melange and Cotton Blended Dyed yarn involving a capital outlay of about Rs. 235 Crores which will be financed by internal accruals and loans from banks.

5.3.2 Further, the Company has spent Rs. 58 Crores on modernization and balancing equipments at all its units during 2014-15. The capital purchases were financed by internal accruals and loans from Banks.

5.4 Acquisition

Your Company has an existing spinning capacity of 2,93,736 spindles as on March 2015. The Company has been actively exploring further growth in spindlage to effectively expand its spinning capacity to a substantial extent. As organic growth through installation of additional spindles would have taken considerable time for project implementation. Your Board has approved acquisition of Birla Textile Mills, located at Baddi, Tehsil Nalagarh, District Solan, Himachal Pradesh [Textile Division of Chambal Fertilisers and Chemicals Limited] having 83,376 spindles to manufacture cotton, blended and synthetic grey and dyed yarns, as a going concern on slump sale basis. The acquisition which shall be effective from 1st April, 2015 (subject to requisite statutory and regulatory approvals) shall be at the total purchase consideration of Rs. 232.63 crores (including net current assets less term loans), and subject to closing and other adjustments, if any. This acquisition will be financed by internal accruals and loans from Banks. Post acquisition the spinning capacity shall be 3,77,112 spindles. The acquisition of the Birla Textile Mills will have strong synergy with the business of the Company as it also manufactures cotton, blended and synthetic grey and dyed yarns.

6. Closure of Company's Fabric Division, namely, Damanganga Fabrics, Bhilad, Gujarat

During the financial year under review, your Company decided to permanently close the operations of one of the Company's weaving unit of, Damanganga Fabrics, Daheli, Bhilad Gujarat. In view of the continuous un-economic working, with no possibility of its revival in the future, your Company decided to permanently close the operations of the weaving Division of Damanganga Fabrics Unit, w.e.f. 1st October, 2014. The impact of the closure on the Company's operations was not significant in terms of the Unit's contribution to Company's turnover as well as to the profitability, as the turnover of the Unit in FY 2013-2014 was Rs. 60.71 Crore, as against total turnover of the Company which was Rs. 1,880.62 Crore that is 3.23 per cent only of the total turnover. The Unit had reported a net loss of Rs. 9.38 Crore in FY 2013-2014, against total net profit (after tax) of the Company of Rs. 131.38 Crore.

7. Directors

7.1 The company's Board of Directors comprises Nine members, Eight of whom are Non-executive Directors and one Wholetime Director. The Non-executive Directors are eminent professionals with vast experience of industry, finance and law.

7.2 Meetings of the Board

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year under review, Seven Board Meetings and Five Audit Committee Meetings were convened and held, the details of which are given in the Corporate Governance Report forming part of this Annual Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and Listing Agreement.

7.3 At its Ninth Annual General Meeting held on 23rd August, 2014, your Company had appointed the existing Independent Directors viz., Shri U. K. Khaitan, Shri Amit Dalal, Shri Rajiv Podar, Shri Rajan Dalal and Dr. Mahmoodur Rahman as Independent Directors under the Act for a term of five years with effect from 23rd August, 2014. 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.

7.4 On the recommendation of the Nomination & Remuneration Committee, the Board of Directors has appointed Ms. Sonu Bhasin as Additional Director (Non- Executive Independent) on 7th May, 2015, subject to the approval of the Shareholders at the forthcoming Tenth Annual General Meeting of the Company.

7.5 Board Evaluation

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

7.6 In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Shri C. S. Nopany retires by rotation and is eligible for re-appointment at the forthcoming Tenth Annual General Meeting.

7.7 Remuneration Policy

The Board on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management personnel and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report and is also available on the Company's Website. The Policy contains, inter-alia, directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director, etc. The policy is available on the website of the Company at the weblink: http://sutlejtextiles.com/pdf/policy/ Remuneration-Policy.pdf

8. Directors' Responsibility Statement

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

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

b. that such accounting policies have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the profit of the Company for the year ended on that date;

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

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

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

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

9. Related Party Transactions

All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons, except Acquisition of Birla Textile Mills (a Division of Chambal Fertilisers and Chemicals Ltd. (CFCL)) by virtue of Shri C. S. Nopany being Director in your Company as well as in CFCL and holding more than two percent of equity shares alongwith his relatives in CFCL.

All Related Party Transactions are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee is obtained on a quarterly basis for the transactions which are of a foreseen and repetitive nature. A detailed statement of such related party transactions entered into pursuant to the omnibus approval so granted are placed before the Audit Committee and the Board of Directors for their review on a quarterly basis. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes to the Financial Statements. The Form No. AOC-2 is annexed to this report.

The Company has developed a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions. The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website at the weblink: http://sutlejtextiles.com/pdf/policy/Policy-on- Related-Party-Transactions.pdf

10. Significant and Material Orders Passed By The Regulators Or Courts

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

11. Vigil Mechanism / Whistle Blower Policy

The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance Task Force comprising senior executives of the Company. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter to the Task Force or to the Chairman of the Audit Committee. The Policy on vigil mechanism and whistle blower policy may be accessed on the Company's website at the link: http://sutlejtextiles.com/pdf/policy/ Whistle-Blower-Policy-adopted-13.05.14.pdf

12. Auditors Report

The Notes on Accounts and the observations of the Auditors in their Report on the Accounts of the Company are self- explanatory and in the opinion of the Directors, do not call for any further clarifications.

13. Auditors

13.1 Statutory Auditor

The Company's Auditors, M/s. Singhi & Co., Chartered Accountants, Delhi (Reg No. 302049E) who retire at the ensuing Annual General Meeting of the Company are eligible for reappointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder for reappointment as Auditors of the Company. As required under Clause 49 of the Listing Agreement, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

13.2 Branch Auditor

The Company's Branch Auditors, M/s. S.R. Batliboi & Co. LLP., Chartered Accountants (Reg No. 301003E), retire at the conclusion of Annual General Meeting and are eligible for re-appointment. Requisite Consent and Certificates from the Auditors have been received to the effect that their re- appointment, if made, would be within the limits prescribed under Chapter X of the Companies Act, 2013 and Companies (Audit and Auditors) Rules, 2014 under the said Act. Further, they also hold a valid certificate issued by the Peer Review Board of the ICAI as required under revised clause 41 of listing agreement.

13.3 Internal Auditors

The Board of Directors upon the recommendation of the Audit Committee of the Board on 13th May, 2015 has appointed M/s. Vaish & Associates, Chartered Accountants (FRN:005388N) as Internal Auditors of the Company. They have confirmed their eligibility and has granted consent to act as Internal Auditors of the Company.

13.4 Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company are required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s. K. G. Goyal & Associates, Jaipur (Reg No. FRN-000024) to audit the cost auditing records relating to Company's units Rajasthan Textile Mills, Chenab Textiles Mills, Damanganga Home Textiles for the financial year 2015-16 on a remuneration of Rs. 1.35 lakhs. The appointment is subject to the approval of the Central government. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member's ratification for the remuneration payable to K.G.Goyal & Associates, Cost Auditors is included in the Notice convening the Annual General Meeting.

13.5 Secretarial Audit

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 appointed M/s. R. Chouhan & Associates, Company Secretary in Practice, to undertake the Secretarial Audit of the Company for the year under review. The Audit Report annexed along with observations of the Auditor is self-explanatory and, does not call for any further clarification.

14. Business Risk Management

Pursuant to Clause 49 of the Listing Agreement, the Company has laid down a framework to inform the Board about the particulars of risk assessment and minimization procedures. These procedures are reviewed by the Board annually to ensure that executive management controls risk through the mechanism of a properly defined framework.

The Company has a robust Business Risk Management framework to identify, evaluate, access business risks and their impact thereupon. The key business risk elements identified by the Company and bifurcated under different heads are as under:

I. Operations : This head includes risk elements such as Non-availability of Labour, Labor Unrest, Non-availability of Power, Non-Availability of Water, Breakdown, Non- availability of Competent Personnel, Pollution Control, Legal Compliance, Safety, Logistics / Transport, Machinery Spares and Equipment Issues, etc.

II. Raw Materials : This head covers Cost of Raw Materials, Non-Availability of Raw Materials, etc.

III. Financial : This head covers risk elements such as Dwindling Financial Ratios, Foreign Exchange Fluctuations, Drop in Credit Rating, Investor Relations, Fraud, Inadequate Insurance, etc.

IV. Market : This head includes risk elements such as Price of Finished Products, Demand Supply Mismatch, Substitute Products, Bad Debts, Service / Product Complaints, Brand Image, etc.

Each element of Risk mentioned above is measured on a scale of 100, based on the probability of risk and based on such assessment, the risk is further classified under 6 categories from "A" to "F" where "A" denotes highest risk perception and "F" denotes lowest risk perception.

The Impact of each element of assessed risk is also measured on a scale of 100 in terms of impact on profits of the Company and is further classified under 6 categories from "A" to "F" as mentioned above.

15. Internal Control Systems and their adequacy

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit (IA) function is defined in the mandate provided to the internal Auditors. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

16. Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

The requisite information with regard to conservation of energy, technology absorption and foreign exchange earnings and outgo, in terms of the Section 134(3)(m) of the Companies Act, 2013, read with Companies (Accounts) Rules, 2014 is given in "Annexure I", to this report.

17. Management Discussion and Analysis Report

The detailed review of the operations, performance and outlook of the Company is given separately in the Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement, by way of "Annexure II" to this report.

18. Corporate Governance

Your Company is committed to maintain the highest standards of ethics and governance, resulting in enhanced transparency for the benefit of all stakeholders. The Company fully complies with the governance practices as enunciated in the Listing Agreement. As per Clause 49 of the Listing Agreement with stock exchanges, and the requirements set out by the Securities and Exchange Board of India, the Company has implemented all the stipulations prescribed. The Company has adopted a Code of Conduct, which is applicable to the Board members and senior management, in accordance with the recently enacted statutory changes. The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreements forms a part of this report as "Annexure III". The requisite Certificate from the Statutory Auditors of the Company, M/s Singhi & Co., Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is annexed to the Report on Corporate Governance. The General Shareholders Information annexed to the Report forms a part of the Report.

19. Corporate Social Responsibility

Your Company had formed a Corporate Social Responsibility ("CSR") Committee in conformity with Section 135 of the Companies Act, 2013 and Rules made thereunder to oversee the CSR Activities initiated by the Company during the financial year under review. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board's Report. The CSR Committee had adopted a CSR Policy for the Company which provides a broad framework with regard to implementation of CSR Activities carried out by the Company in accordance with Schedule VII of the Companies Act, 2013 which may be accessed on the Company's website at the link: http://sutlejtextiles.com/pdf/ policy/SUTLEJ-CSR-Policy-2014- Adopted-1 3.05.2014.pdf. A report on CSR activities as prescribed under the Companies Act, 2013 and Rules made thereunder is annexed herewith as "Annexure IV".

20. Prevention of Sexual Harassment at Workplace

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 ('Act') and Rules made thereunder, your Company has constituted Internal Complaints Committees (ICC) at its workplaces. During the year, no complaints were filed with the Company.

21. Extract of Annual Return

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure V".

22. Particulars of Employees

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is provided herewith as "Annexure VI", which forms part of the Report.

23. Acknowledgements

Your Directors would like to express their sincere appreciation for assistance and co-operation received from the various stake holders including financial institutions and banks, Governmental authorities and other business associates who have extended their valuable support and encouragement during the year under review.

Your Directors take the opportunity to place on record their deep appreciation of the committed services rendered by the employees at all levels of the Company, who have contributed significantly towards Company's performance and for enhancing its inherent strength. Your Directors also acknowledge with gratitude the encouragement and support extended by our valued shareholders.

For and on behalf of the Board

Place : Mumbai C.S. Nopany Dated : 07.05.2015 Chairman


Mar 31, 2014

Dear Members,

1. The Directors are pleased to present their Ninth Annual Report on the business and operations of your Company for the year ended 31st March, 2014.

Financial results (Rsin lakhs)

Particulars Year ended Year ended 31st March 31st March 2014 2013 Revenue from Operations (Gross) 188,390.37 169,036.95

Gross Profit 24,754.98 16,899.52

Less: Depreciation, Impairment and Amortisation Expenses 7,518.62 7,014.67

Exceptional Item 63.73 605.84

Taxation:

-Current 3,589.00 1,921.00

- MAT Credit (entitlement)/ Utilised 766.00 (100.00)

- Earlier years (net) (7.68) 5.33

- Deferred (net) (312.50) (244.07)

Net Profit 13,137.81 7,696.75

Add: Balance brought forward from the previous year 22,100.16 15,842.31

Profit available for appropriation 35,237.97 23,539.06

Appropriations:

Proposed dividend 1,310.63 546.10

Corporate dividend tax 222.74 92.80

Transfer to the general reserve 1,400.00 800.00

Balance in statement of profit and loss 32,304.60 22,100.16

TOTAL 35,237.97 23,539.06

Dividend

2. Your Directors are pleased to recommend dividend of ^8 per share for the year ended 31st March, 2014, subject to shareholders'' approval at the forthcoming Annual General Meeting. The total amount of dividend to be paid to the shareholders will be ^1,533.37 lakhs (inclusive of dividend tax).

Share Capital

3. 1. Your Company has issued and allotted 54,60,954 Bonus Shares to its Shareholders during the FY 2013-14 in the ratio of 1 (One) Bonus Equity Share for every 2 (Two) existing Equity

26

Shares, after capitalising a sum of ^5,46,09,540 (Rupees Five Crore Forty Six Lakh Nine Thousand Five Hundred Forty Only) from the Capital Reserve and General Reserve. The total paid up share capital of the Company after the Bonus Issue stands at 16,382,862 shares of Rs.10 each.

3.2. The Company, vide a resolution passed in the 8th Annual General Meeting of the shareholders, has reclassified and increased its Authorised Share Capital from ^30 Crore (Rupees Thirty Crore Only) to ^50 Crore (Rupees Fifty Crore Only) divided into 5,00,00,000 Equity Shares of Rs.10 each.

Capital Projects

4.1 The Company is in the process of implementing a major expansion project of 30,672 spindles at its Kathua Unit for manufacturing Cotton Melange and Cotton Blended Dyed yarn involving a capital outlay of about Rs.175 Crore. The Company has spent approximately Rs.54 Crore on this project during the year. Further, the Company has spent Rs.55 Crore on modernisation and balancing capital equipments at all its units. The capital purchases were financed by internal accruals and loans from Banks.

4.2 The Company further intends to invest on modernisation and balancing capital equipments to the tune of Rs.119 Crore during 2014-1 5, which will be financed by internal accruals and loans from banks.

Fixed Deposits

5.1 At the end of the financial year under review, fixed deposits from the public, shareholders and employees amounted to Rs.2,553.10 lakhs and deposits amounting to nil remained unclaimed as on 31 st March, 2014.

5.2 In compliance with Chapter V of the Companies Act, 2013 relating to Acceptance of Deposits by Companies and Companies (Acceptance of Deposits) Rules, 2014, your Company has decided to repay/pre-pay outstanding deposits along with the accrued interest either on due dates or within one year from the commencement of the revised Rules, whichever is earlier.

Particulars of Employees

6. Information in accordance with Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, is given in Annexure-I, which forms part of this report.

Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

7. The requisite information with regard to conservation of energy, technology absorption and foreign exchange earnings and outgo, in terms of the Section 217(1) (e) of the Companies Act, 1956, read with Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988 is given in Annexure-ll, to this report.

Management Discussion and Analysis Report

8. The detailed review of the operations, performance and outlook of the Company is given separately in the Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement, by way of Annexure-lll to this report.

Corporate Governance

9. Your Company is committed to maintain the highest standards of ethics and governance, resulting in enhanced transparency for the benefit of all stakeholders. As per the revised Clause 49 of the Listing Agreement with the Stock Exchanges, and the requirements set out by the Securities and Exchange Board of India, the Company has implemented all the stipulations prescribed. The Company has adopted a Code of Conduct, which is applicable to the Board members and senior management, in accordance with the recently enacted statutory changes. The Company fully complies with the governance practices as enunciated in the Listing Agreement. The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreements forms a part of this report as Annexure-IV.

10. The requisite Certificate from the Statutory Auditors of the Company, M/s Singhi & Co., Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is annexed to the Report on Corporate Governance.

11. The General Shareholders Information annexed to the Report forms a part of the Report.

Compliance of Accounting Standards

12. As per requirement of the Listing Agreement with Stock Exchanges and Accounting Standards of the Institute of Chartered Accountants of India, your Company has made disclosures in respect of Related Party Transactions and Deferred Taxation. The applicable Accounting Standards Rules have been duly adopted by the Company in pursuance to the provision of Section 211 (3A) of the Companies Act, 1956.

Directors'' Responsibility Statement

13. As required under Section 217 (2AA) of the Companies Act, 1956, your Directors hereby confirm:

(i) That in the preparation of the annual accounts for the year ended 31st March, 2014, the applicable Accounting Standards Rules relating to material departures, if any, were followed along with proper explanations; and the Notes in the Auditors'' Report in this regard are self-explanatory;

(ii) That such accounting policies were selected and applied consistently and judgements and estimates were made that were reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit of your Company for the year ended 31st March, 2014;

(iii) That proper and sufficient care were taken for the maintenanceof adequate accounting recordsin accordancewith the provisions of the Companies Act, 1956, for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

(iv) That the annual accounts have been prepared on a going concern basis for the financial year ended 31 st March, 2014.

Directors

14.1. Pursuant to Section 152 of the Companies Act, 2013, read with Article 139 of the Articles of Association of the Company, Mr. Sukhvir Singh, a Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for reappointment.

14.2. As required under section 149(10) and (11) of the Companies Act, 2013 read with Clause 49 of the Listing Agreement, the following Directors of the Company namely Shri U.K.Khaitan, Amit Dalai, Rajan Dalai, Rajiv Podar and Dr. Mahmoodur Rahman, who held office as Independent Directors shall require reappointment at the Annual General Meeting. Being eligible, each of the Directors has offered himself for reappointment. Members are requested to appoint them for tenure of 5 years as Independent Directors (not liable to retire by rotation).

Auditors'' Report

15. The Notes on accounts and the observations of the Auditors in their Report on the Accounts of the Company are self-explanatory and in the opinion of the Directors, do not call for any further clarifications.

Auditors

1 6. M/s. Singhi & Co., Auditors (registration no. 302049E) and

M/s. S.R. Batliboi & Co. LLP, Branch Auditors (registration no. 301003E) retire at the conclusion of Annual General Meeting and are eligible for reappointment. Requisite Consent and Certificates from the Auditors have been received to the effect that their reappointment, if made, would be within the limits prescribed under Chapter X of the Companies Act, 2013 and Companies (Audit and Auditors) Rules, 2014 under the said Act. Further, they also hold a valid certificate issued by the Peer Review Board of the ICAI as required under revised clause 41 of listing agreement.

Cost Auditors

17. In accordance with the directive of the Central Government and pursuant to Section 148 of the Companies Act, 2013, M/s. K. G. Goyal & Associates, Jaipur, Cost Accountants, have been appointed as Cost Auditors to audit the cost accounting records relating to Company''s units Rajasthan Textile Mills, Chenab Textiles Mills, Damanganga Fabrics and Damanganga Home Textiles for the financial year 2014-1 5. The appointment is subject to the approval of the Central government.

18. Cost Audit Reports for all the applicable products for the year ended 31.03.2013 were filed in the requisite revised format with the Cost Audit Cell of the Ministry of Corporate Affairs on 5.9.2013, that is, within the permitted due date.

Acknowledgements

19. Your Directors would like to express their sincere appreciation for assistance and co-operation received from the various stake holders including financial institutions and banks, Governmental authorities and all other stakeholders who have extended their valuable support and encouragement during the year under review.

Your Directors take the opportunity to place on record their deep appreciation of the committed services rendered by the employees at all levels of the Company, who have contributed significantly towards Company''s performance and for enhancing its inherent strength. Your Directors also acknowledge with gratitude the encouragement and support extended by our valued shareholders.

For and on behalf of the Board

Place: Mumbai C.S. Nopany Dated: 13.05.2014 Chairman


Mar 31, 2013

1. The Directors are pleased to present their Eighth Annual Report on the business and operations of your Company for the year ended 31st March, 2013.

FINANCIAL RESULTS (Rs. in lakhs)

Year ended Year ended Particulars 31st March, 2013 31st March, 2012

Revenue from Operations (Gross) 169036.95 154170.79

Gross Profit 16899.52 10860.78

Less: Depreciation and Amortisation expenses 7014.67 6900.36

Exceptional Item 605.84 -

Taxation:

-Current 1921.00 890.00

- MAT Credit (entitlement)/reversal (100.00) 161.00

- Earlier years (net) 5.33 10.98

- Deferred (net) (244.07) (274.95)

Net Profit 7696.75 3173.37

Add: Balance brought forward from the previous year 15842.31 13703.63

Profit available for appropriation 23539.06 16877.00

Appropriations:

Proposed dividend 546.10 546.10

Corporate dividend tax 92.80 88.59

Transfer to the general reserve 800.00 400.00

Balanc e statement of profit and loss 22100.16 15842.31

TOTAL 23539.06 16877.00

DIVIDEND

2. Your Directors are pleased to recommend dividend of Rs. 5/- per share for the year ended 31st March, 2013, subject to shareholders'' approval at the forthcoming Annual General Meeting. The total amount of dividend to be paid to the shareholders will be Rs. 638.90 lakhs (inclusive of dividend tax).

BONUS ISSUE

3. Your Company has posted substantial/significant growth both in revenues as well as profits in the last few years. In view of this successful value creation cycle, and accrued position of Reserves & Surplus as at 31st March, 2013, the Board of Directors have great pleasure in proposing issue of Bonus shares in the ratio of 1 (One) Bonus equity share for every 2 (Two) existing shares; subject to approval by the Shareholders of the Company and other Statutory Approvals as may be required, by capitalizing a sum not exceeding Rs. 5,46,09,540/- (Rupees Five Crore Fortysix Lakhs Nine Thousand Five Hundred Forty Only) from the Capital Reserve, General Reserve and/or Statement of Profit & Loss, (as may be decided by the Board of Directors) and applying the said sum in paying up in full for issue of up to 5460,954 Equity Shares of Rs. 10 each to the Members of the Company, in proportion of One (l) Bonus Equity Share of Rs. 10 each for every Two (2) Fully paid-up Equity Shares of Rs. 10 each held by them.

CAPITAL PROJECTS

4. The Company invested Rs.30 crores during the year for modernization. The Company intends to further invest Rs.l67 crores for expansion of its Kathua Unit by 26064 spindles for manufacture of value added Cotton Melange and Cotton Blended Dyed yarns and Rs.97 crores for modernization and balancing capital equipments.

The capital purchases will be financed by internal accruals and loans from Banks.

FIXED DEPOSITS

5. At the end of the financial year under review, fixed deposits from the public, shareholders and employees amounted to Rs. 2234.90 lakhs; deposits amounting to Rs.0.20 lakh remained unclaimed as on 31st March, 2013.

PARTICULARS OF EMPLOYEES

6. Information in accordance with Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, is given in Annexure-I, which forms a part of this report.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

7. The requisite information with regard to conservation of energy, technology absorption and foreign exchange earnings and outgo, in terms of the Section 217(l)(e) of the Companies Act, 1956, read with Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988 is given in Annexure-ll, to this report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

8. The detailed review of the operations, performance and outlook of the Company is given separately in the Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement, by way of Annexure-lll to this report.

CORPORATE GOVERNANCE

9. Your Company is committed to maintain the highest standards of ethics and governance, resulting in enhanced transparency for the benefit of all stakeholders. As per the revised Clause 49 of the Listing Agreement with stock exchanges, and the requirements set out by the Securities and Exchange Board of India''s Corporate Governance Practices, the Company has implemented all the stipulations prescribed. The Company has adopted a code of conduct applicable to the Board and senior management. The Company fully complies with the governance practices as enunciated in the Listing Agreement. The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreements forms a part of this report as Annexure- IV.

10. The requisite Certificate from the Statutory Auditors of the Company, M/s Singhi & Co., Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is annexed to this Report by way of Annexure- IV.

11. The General Shareholders Information annexed with Annexure-IV, forms a part of this Report.

COMPLIANCE OF ACCOUNTING STANDARDS

12. As per requirement of the Listing Agreement with Stock Exchanges and Accounting Standards of the Institute of Chartered Accountants of India, your Company has made disclosure in respect of Related Party Transactions and Deferred Taxation. The Company has duly adopted the applicable Accounting Standards Rules in pursuance to the provision of Section 211 (3A) of the Companies Act, 1956.

DIRECTORS'' RESPONSIBILITY STATEMENT

13. As required under Section 217 (2AA) of the Companies Act, 1956, your Directors hereby confirm:

(i) That in the preparation of the annual accounts, the applicable accounting standards rules relating to material departures, if any, were followed along with proper explanations and the Notes in the Auditors'' Report in this regard are self-explanatory;

(ii) That such accounting policies were selected and applied consistently and judgements and estimates were made that were reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit of your Company for the year ended 31st March, 2013;

(iii) That proper and sufficient care were taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

(iv)That the annual accounts were prepared on a going concern basis.

DIRECTORS .

14. Pursuant to section 256 of the Companies Act, 1956, read with Article 139 of the Articles of Association of the Company, Mr. C.S.Nopany, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for reappointment.

AUDITORS'' REPORT

15. The Notes on accounts and the observations of the Auditors in their Report on the Accounts of the Company are self-explanatory and in the opinion of the Directors, do not call for any further clarifications.

AUDITORS

16. M/s. Singhi b Co., Auditors (registration No. 302049E) and M/s. S.R. Batliboi & Co. LLP., Branch Auditors( registration No.301003E) retire at the conclusion of Annual General Meeting and are eligible for re-appointment. Certificate from the Auditors have been received to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224 (IB) of the Companies Act, 1956. Further they also hold a valid certificate issued by the Peer Review Board of the ICAI as required under revised clause 41 of listing agreement.

COST AUDITORS

17. In accordance with the directives of the Central Government and pursuant to Section 233B of the Companies Act, 1956, M/s. K. G. Goyal & Associates, Jaipur, Cost Accountants, have been appointed as Cost Auditors to audit the cost accounting records relating to Company''s units Rajasthan Textile Mills, Chenab Textiles Mills, Damanganga Fabrics and Damanganga Flome Textiles for the financial year 2013-14. The appointment is subject to the approval of the Central government.

18. Cost Audit Reports for all the applicable products for the year ended 31.03.2012 were filed in current format on 23.01.2013 with the Cost Audit Cell of the Ministry of Corporate Affairs, within due date viz. 28.02.2013.

ACKNOWLEDGEMENTS

19. Your Directors would like to express their sincere appreciation for assistance and co-operation received from the various stake holders including financial institutions and banks, Governmental authorities and other business associates who have extended their valuable support and encouragement during the year under review. Your Directors take the opportunity to place on record their deep appreciation of the committed services rendered by the employees at all levels of the Company, who have contributed significantly towards Company''s performance and for enhancing its inherent strength. Your Directors also acknowledge with gratitude the encouragement and support extended by our valued shareholders.

For and on behalf of the Board

Place; Mumbai C.S. Nopany

Dated: May 08, 2013 Chairman


Mar 31, 2012

1. The Directors are pleased to present their Seventh Annual Report on the business and operations of your Company for the year ended 31st March, 2012.

Financial Results

(Rs. in lakhs)

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

Revenue from Operations (Gross) 154170.79 158546.19

Gross Profit 10860.78 21560.71

Less: Depreciation 6900.36 6786.20

Taxation:

- Current 890.00 2945.00

- MAT Credit (entitlement)/reversal 161.00 (2625.64)

- Earlier years (net) 10.98 (2.17)

- Deferred (net) (274.93) 3023.11

Net Profit 3173.37 11434.21

Add: Balance brought forward from the previous 13703.63 4421.45 year

Profit available for appropriation 16877.00 15855.66

Appropriations:

Proposed dividend 546.10 819.14

Corporate dividend tax 88.59 132.89

Transfer to general reserve 400.00 1200.00

Balance in profit and loss statement 15842.31 13703.63

TOTAL 16877.00 15855.66

Dividend

2. Your Directors are pleased to recommend dividend of Rs. 5/- per share for the year ended 31st March, 2012, subject to shareholders' approval at the forthcoming Annual General Meeting. The total amount of dividend to be paid to the shareholders will be Rs. 634.69 lakhs (inclusive of dividend tax).

Capital Projects

3. The Company invested Rs. 53 crore during the year for capital projects and intends to further invest Rs. 71 crore in 2012-13 for modernisation, upgradation and balancing capital equipments.

The capital purchases are being financed by internal accruals and loans from Banks under Technology Upgradation Fund Scheme of the Government of India.

Fixed Deposits

4. At the end of the financial year under review, fixed deposits from the public, shareholders and employees amounted to Rs. 1791.10 lakhs; deposits amounting to Rs. 0.43 lakh remained unclaimed as on 31st March, 2012.

Particulars of Employees

5. Information in accordance with Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, is given in Annexure-I, which forms part of this report.

Energy, Technology and Foreign Exchange

6. The requisite particulars with regard to energy conservation, technology absorption and foreign exchange earnings and outgo, in terms of the Section 217(1)(e) of the Companies Act, 1956, read with Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988 are given as Annexure-II, to this report.

Management Discussion and Analysis Report

7. The detailed review of the operations, performance and outlook of the Company is given separately in the Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement, by way of Annexure-III to this report.

Corporate Governance

8. We adhere to the principles of Corporate Governance mandated by the requirements set out by the Securities And Exchange Board of India's Practices and the Listing Agreement with the Stock Exchanges and have implemented all the prescribed stipulations. As required by Clause 49(VI) of the Listing Agreement a detailed report on Corporate Governance forms a part of this Report as Annexure-IV. Certificate from the Statutory Auditors of the Company, M/s Singhi 8 Co., Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is annexed to this Report.

Your Company is committed to maintain the highest standards of ethics and governance, resulting in enhanced transparency for the benefit of all stakeholders and recognises the importance of continuous assessment of governance practices to create long term value for all the stakeholders.

9. General Shareholder Information annexed with Annexure IV, forms a part of this Report.

Compliance of Accounting Standards

10. As per requirement of the Listing Agreement with Stock Exchanges and Accounting Standards of the Institute of Chartered Accountants of India, your Company has made disclosure in respect of Related Party Transactions and Deferred Taxation. The Company has duly adopted the applicable Accounting Standards in pursuance to the provision of Section 211 (3A) of the Companies Act, 1956.

Directors' Responsibility Statement

11. As required under Section 217 (2AA) of the Companies Act, 1956, your Directors hereby confirm:

(i) That in the preparation of the annual accounts, the applicable accounting standards relating to material departures, if any, were followed along with proper explanations and the Notes in the Auditors' Report in this regard are self-explanatory;

(ii) That such accounting policies were selected and applied consistently and judgements and estimates were made that were reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit of your Company for the year ended 31st March, 2012

(iii) That proper and sufficient care were taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

(iv) That the annual accounts were prepared on a going concern basis.

Directors

12. Mr. J.S.Varshneya who was a Director of the Company since 1st June, 2006 and a Member of the some of the Board Committees of the Company, expired suddenly after a brief illness. The Board of Directors lost a valuable member who had made substantial contributions over the years and have conveyed their condolences and deep appreciation to late Mr. Varshneya's family.

13. Mr. S.M.Agarwal a Director of the Company since 2005, retires by rotation at the ensuing Annual General Meeting, and has conveyed his decision not to offer himself for re-appointment due to advanced age. Mr. Agarwal who was a Member of the Finance and Corporate Affairs Committee and is currently a member of the Audit and Remuneration Committees, has contributed significantly to the deliberations of the Board/Committee meetings. The Directors place on record their appreciation of the contributions made by Mr. Agarwal during his tenure on the Board.

14. Mr. U.K.Khaitan and Mr. Amit Dalal, Directors of the Company, retire at the Seventh Annual General Meeting pursuant to section 256 of the Companies Act, 1956, read with Article 139 of the Articles of Association of the Company; and being eligible, offer themselves for reappointment.

15. Dr. Mahmoodur H. Rahman, who was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956, holds office upto the ensuing Annual General Meeting, and being eligible offers himself for appointment as a Director.

Auditors' Report

16. The Notes on accounts and the observations of the Auditors in their Report on the Accounts of the Company are self-explanatory and in the opinion of the Directors, do not call for any further clarifications.

Auditors

17. M/s. Singhi & Co., Statutory Auditors (registration no. 302049E) and M/s. S.R. Batliboi & Co., Branch Auditors (registration no.301003E) retire at the conclusion of Seventh Annual General Meeting and are eligible for re-appointment. Certificate from the Auditors have been received to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224 (1B) of the Companies Act, 1956. Further they also hold a valid certificate issued by the Peer Review Board of the ICAI as required under revised clause 41 of listing agreement.

Cost Auditors

18. In accordance with the directives of the Central Government and pursuant to Section 233B of the Companies Act, 1956, M/s. K. G. Goyal & Associates, Jaipur, Cost Accountant, have been appointed as Cost Auditors to audit the cost accounting records relating to Company's units Rajasthan Textile Mills, Chenab Textiles Mills, Damanganga Fabrics, Damanganga Garments and Damanganga Home Textiles for the Financial year 2012-13. The appointment is subject to the approval of the Central Government.

19. Cost Audit Reports for all the applicable products for the year ended 31.03.2011 were filed on 24.09.2011 with the Cost Audit Cell of the Ministry of Corporate Affairs, within due dates viz.27.09.2011.

Acknowledgements

20. Your Directors would like to convey their sincere appreciation for assistance and co-operation received from the various stake holders including financial institutions and banks, Governmental authorities and other business associates who have extended their valuable support and encouragement during the year under review. Your Directors take the opportunity to place on record their deep appreciation of the committed services rendered by the employees at all levels of the Company who have contributed significantly towards Company's performance. Your Directors also acknowledge with gratitude the encouragement and support extended by our valued shareholders.

For and on behalf of the Board

Place: New Delhi C.S. Nopany

Dated: May 16, 2012 Chairman

 
Subscribe now to get personal finance updates in your inbox!