Mar 31, 2023
The Directors are pleased to present the 50th Annual Report and the Audited Financial Statements of the Company for the year ended 31st March, 2023.
FINANCIAL RESULTS |
(Rs. In Crores) |
|
DESCRIPTION |
2022-23 |
2021-22 |
Sales Turnover (Net of GST) |
515.09 |
180.57 |
Gross Profit / (Loss) after meeting all expenses, but before providing depreciation and interest |
85.64 |
(28.63) |
Interest |
3.21 |
2.30 |
Cash Profit / (Loss) |
82.43 |
(30.93) |
Depreciation for the year |
3.67 |
3.04 |
Extraordinary items |
- |
- |
Net Profit / (Loss) for the year |
78.76 |
(33.97) |
Accumulated Loss |
(339.63) |
(418.39) |
Networth before revaluation of land & buildings |
(211.01) |
(289.97) |
Networth after revaluation of land & buildings |
9.67 |
(69.09) |
Unabsorbed deferred tax benefit |
22.42 |
-- |
Total Earnings |
101.18 |
(33.97) |
EPS & Diluted EPS |
8.30 |
(2.79) |
The production for the financial year increased substantially by 40% over the last financial year, which was affected by the unseasonal rains and non-availability of salt and coal. However this year, the production was maintained as planned, almost all the days. However it could not be pushed further due to recurring maintenance issues, which now have been effectively attended to, and also due to loss of production for a month due to complete structural failure of the control room in October ''22. However, our team has responded very fastly to bring back the productivity within 30 days by installing the controls in make shift arrangement.
The average production levels have now been stabilized at around 200 TPD and your Company hopes to reach 225 TPD average in the current financial year.
All the repair works on major tanks, pipelines etc. were carried out, to achieve the above production level. New centrifuge, pumps have been added and orders have been placed for phased change of large volume circulation pumps, which will improve the efficiency of the plant further.
The production and sales during the year ended 31st March, 2023 compared to the previous year, are as given below;
(Qty. in MTs) |
||||
Sales |
||||
Product |
Production |
(Includes internal Consumption) |
||
2022-23 |
2021-22 |
2022-23 |
2021-22 |
|
Soda Ash (Light) |
58,430 |
41,683 |
* 57,099 |
* 41,860 |
Ammonium Chloride |
55,402 |
37,414 |
62,122 |
30,547 |
Your Directors are not able to recommend any dividend in view of the accumulated losses.
The selling price of Soda ash was in tune with the landed cost of the international product, which remained high throughout the year. The prices were stable throughout the year and the market was also absorbing the material, at that price.
The price of salt and coal went up during the year, however the availability was not an issue. The ammonia price continued to increase and after reaching all-time high, it started coming down from the 4th quarter of the financial year 2022-23. The Soda ash sales to detergent units, has picked up and also steady and in view of the better plant performance, the Company hopes to market atleast
55.000 to 65,000 MTs of Soda Ash in the current financial year. Our other regular customers'' need also will be met satisfactorily.
Ammonium Chloride has found acceptance with many users during the last financial year and your Company sold all-time high of around
62.000 MTs of Ammonium Chloride in the financial year.
Since the market for the soda ash manufactured by your Company is continuing to improve in view of the lower carbon footprint when compared to competing product, it should be possible to ramp-up the production further, and also expand the capacity.
Our Company is targeted to convert the boiler feedstock from coal to biomass. The CO2 capture plant is being upgraded with a special technology, which is expected to bring down the cost of the production further, and also capture more CO2, which will enable the Company to expand further and distribute lower carbon footprint Soda ash to detergent units, who have also announced to align with the Carbon Reduction Intention of the Government of India.
Ammonia storages with M/s.Greenstar Fertilizers Limited, has enabled the Company to operate continuously without having to shutdown for want of ammonia.
While there is an opportunity to increase the production, the additional production of Soda Ash need to be moved up North, as your Company is located in the southern tip of India, this will bring in additional transportation cost. However effective use of rail racks and coastal shipping, will help us in keeping the cost under control and maximize the contribution. Your Company is also trying tie-ups with other units in this area, who are transporting large volume, to part use of their facilities, with the view to reduce the cost.
INDUSTRY STRUCTURE AND DEVELOPMENTS.
Soda Ash industry is concentrated in the state of Gujarat due to availability of salt and lime and your company is the only factory which is outside Gujarat. The product is mainly used in the manufacturing of detergents and glass. We co-produce Ammonium Chloride fertilizers, unlike Gujarat based industries. We capture raw material Co2 gas from boiler flue gas whereas others use lime kiln gas.
Soda Ash about 36 Million Tons is the production in the country whereas the consumption level is around 40 Million Tonnes. India is both Importer and Exporter of Soda Ash.
Ammonium Chloride is a fertilizer with 25% available nitrogen. It is under fertilizer control order and is widely used as it is and used in combination with Potassium and phosphorous as complex fertilizer.
RISKS AND CONCERN
The major risks of non-availability of Co2 gas and ammonia has been addressed with Co2 capture plant and additional ammonia storage plant. Only in the unlikely event of blockage of ocean transport of ammonia to India can cause stoppage of production. Since it is a global problem, it is highly unlikely.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
The company has a very good Internal control system with external Internal auditor auditing various aspects and presenting it in the Board. All decisions are implemented after multilevel multidisciplinary scrutiny.
MATERIAL DEVELOPMENTS IN HUMAN RESOURCES
The company has a recognized union operating on democratic principles frequently holding meetings with Human Resources department. We have 266 number of people employed and usually people from the adjacent districts/villages are recruited with a view to train and retain them. The recruitment are done through engineering level and junior engineering level training schemes
DETAILS OF SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS
The plant operations of the company has been improved substantially in 2022-23 and the plant capacity in the year 2022-23 increased by 110% compared to previous year 2021-22. The selling prices of finished goods, ie Soda Ash and Ammonium Chloride are increased during the financial year 2022-23. Due to improved plant performance and selling prices resulted in higher net profit for the company.
The company have revalued its land at Tuticorin windmill land and also the buildings of the company after a long period. The revised value are accounted in the books of account of revaluation, the reserves have been increased and networth has become positive.
ENVIRONMENT AND SAFETY
Updation to ISO 9001:2015 the latest standard is under progress. WIND MILL
During the year 2022-23, 4,59,128 units were generated from Wind Turbine Power Generators at Gudimangalam, Tirupur District, as against 4,70,712 units generated in the previous year. All the available 5 units are operating in good condition. The aging windmills are being refurbished for better results
POWER PURCHASE
Your Company didn''t purchase electricity under the Group Captive Scheme during the financial year starting from 1 st April, 2022 to 31 st March, 2023.
CAPTIVE SALT WORKS
10,845 MTs of salt was produced and all the unused pans were also brought under production and the systems were modified to produce quality salt. With the availability of enriched water from the SWRO plant, more quantity of quality salt would be produced during the year.
FIXED DEPOSIT
There was no outstanding deposit as at 31st March, 2023. The Company has neither accepted nor renewed any deposits during the year under review..
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
Since there was no Dividend declared last year, the provisions of Section 125 of the Companies Act, 2013 do not apply.
MATERIAL CHANGES AND COMMITMENT IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENT RELATES AND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relates on the date of this report. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY The Statement showing the details regarding the development and implementation of Risk Management Policy of the Company is furnished in Annexure 1, which is attached to this report.
The risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting.
Your Company was earlier primarily dependent on SPIC for the supply of CO2, while the ammonia was imported through their storage and pumping system. Your Company has now implemented an independent CO2 Recovery facility, which is operational from November 2016. This has reduced the risk considerably. Ammonia will continue to be imported through the augmented storage system. The Board does not envisage any other major risk.
DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONIBILITY INITIATIVES
The Company has not developed and implemented any Corporate Social Responsibility initiates as the said provisions are not yet applicable as on date in view of the accumulated losses of the Company .
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013
There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
The transactions entered into during the financial year with related party as defined under the Act were in the ordinary course of business and at arm''s length basis. There were no materially significant transactions during the financial year 2022-23, which were in conflict with the interests of the Company. Policy on materiality of related party transactions is placed on the Company''s website viz., www. tacfert.in
COMPANY''S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES
The Company''s Policy relating to appointment of Directors, payment of Managerial remuneration, Directors'' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 is furnished in Annexure 2 and is attached to this report.
NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
The Company had four Board meetings during the financial year under review. Full details are given in the Corporate Governance Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submits its responsibility Statement:-
a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) the Directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors had prepared the annual accounts on a going concern basis; and
e) the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively. Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to 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.
f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary, Joint venture or Associate Company.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
No case of sexual harassment was reported during the year. DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Company''s Board comprises of the following directors: Mr.B.Narendran, Mr.S.Asokan, Mrs.Rita Chandrasekar, Mr.E.Balu, Mr.K.R.Anandan and Mr.G.Ramachandran.
Mr.S.Nandakumar is the Chief Financial Officer of the Company.
Ms.S.Rohini Priyadarshini, the Company Secretary, left the services of the Company on 31.10.2022 and Ms.C.S.Vijayalakshmi, till then Consultant - Secretarial, took over as Company Secretary on 01.11.2022.
PARTICULARS OF SENIOR MANAGEMENT INCLUDING THE CHANGES THEREIN SINCE THE CLOSE OF THE PREVIOUS FINANCIAL YEAR.
Sl. No |
Name of the Director |
Designation |
Change |
With Effect from |
1. |
E. Balu |
Executive Director |
Resignation |
24-05-2023 |
2. |
Devaki Ashwin Muthiah |
Additional Director |
Appointment |
24-05-2023 |
3. |
G. Ramachandran |
Managing Director |
Resignation |
07-08-2023 |
4. |
E. Rajeshkuamr |
Additional Director / WTD |
Appointment |
08-08-2023 |
There are four committees of the Board namely, Audit Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee and Risk Management Committee. The details of composition of committees are furnished in the Corporate Governance report, which is annexed to this report.
DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves for the continuance / appointment as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.
The Independent Directors have also affirmed that they have completed requisite steps towards the inclusion of their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs in terms of Section 150 of the Act, read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014.
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015, the Boards'' performance and performance of the non-independent Director were considered/evaluated by the Independent Directors at their meeting without the participation of the Non-Independent Director and key managerial personnel.
They also assessed the quality, quantity and timeliness of flow of information between the Company''s Management and the Board that are necessary for the Board to effectively and reasonably perform its duties.
Pursuant to the provisions of the Companies act, 2013 and Regulation 17 of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015, 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 various committees.
M/s.MSKA & Associates, Chartered Accountants, Chennai, (Registration No.105047W) have been appointed as Statutory Auditors of the Company in 44th Annual General meeting and after completion of a five years period, the term was further extended by another 5 years, till the AGM to be held in 2027, in the AGM held on 21.09.2022.
M/s. KRA & Associates, Practicing Company Secretaries have been appointed by the Board of Directors to carry out the Secretarial Audit for the year ended 31st March, 2023. Secretarial Auditor''s Report is annexed, which forms part of this report.
As per the Government of India''s directive, the Company''s Cost Reports in respect of Fertilizer -Ammonium Chloride and Chemical - Soda Ash for the year ended 31st March, 2023 are being audited by the Cost Auditor M/s. Ravichandran Bhagyalakshmi & Associates, (Firm Reg No. 001253), who was appointed by the Board. The Company is required to maintain Cost Records as specified by the Central Government under Section 148 (1) of the Act and that accordingly such accounts and records are made and maintained. The Cost Audit Report for the year ended 31 st March, 2022 was filed within the time stipulated under the Act.
EXPLANATIONS OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS
There was no qualification, reservations or adverse remarks made by the Statutory Auditors, M/s. MSKA & Associates and Secretarial Auditor KRA & Associates, Practicing Company Secretaries in their reports.
However the Secretarial Auditor have some observations and our response is as below:-Under SEBI
Delay in one day in furnishing prior intimation of Board Meeting for 31st October, 2022.
Due to oversight, five days of prior Intimation was missed.
Delay in submission of Related party transactions for the half year ended September, 2022.
Due to network issues and due to hospitalization of Company secretary the uploading got delayed by 2 days.
The Statutory Auditors'' Report for the financial year ended, 31st March 2023 is annexed.
The Board has adopted the Policies and Procedures for ensuring the orderly and efficient conduct of its business, including adherence to 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 Disclosures.
DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Audit Committee consists of Mr. B. Narendran, Mr. K.R. Anandan and Mrs. Rita Chandrasekar.
The Company has established a vigil mechanism and oversees through a committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co-employees and the Company. Policy is given in Annexure 3 and is placed on the Company''s website viz., www.tacfert.in.
The Company has not bought back any of its shares during the year under review.
The Company has not issued any âSweat Equityâ Shares during the year under review.
No Bonus Shares were issued during the year under review.
The Company has not provided any Stock Option Scheme to the employees.
The extracts of Annual Return pursuant to the provisions of Section 92 of the Companies Act, 2013 read with relevant Rules, is placed in the website of the Company in the link https://www.tacfert.in/ CORPORATE GOVERNANCE
A report on Corporate Governance as stipulated under Schedule V and Regulation 34(3) of the SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 forms part of this Annual Report. The requisite certificate from a Chartered Accountant confirming compliance with the conditions of corporate governance as stipulated is annexed to this Report.
The Independent Directors attend a Familiarization programme on being inducted to the Board. The details are provided in the Corporate Governance report and on the website of the Company viz., https:// www.tacfert.in. Till COVID set in, the Directors were visiting the factory as a team to keep updated of the progress. Now the visits are made individually and the regular team visits are to commence shortly. However the Directors virtually discuss with Plant personnel couple of times in a year.
DISCLOSURE ON COMPLIANCE WITH SECRETARIAL STANDARDS
Your Directors confirm that the Secretarial Standards issued by the Institute of Company Secretaries of India, have been complied with. PARTICULARS OF EMPLOYEES
The Company has no Employees, whose salary exceeds the limits as prescribed under Rule (5)(2) of Companies (Appointment and Remuneration of Key Managerial Personnel) Rules , 2014. Disclosures under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
The ratio of the remuneration of each director to the median |
Mr.G.Ramachandran |
17.27 |
remuneration of the employees of the Company for the financial |
Mr.B.Narendran |
0.33 |
year - 2022-23 |
Mr.S.Asokan |
0.33 |
Ms.Rita Chandrasekar |
0.33 |
|
Mr.K.R.Anandan |
0.33 |
|
Mr.E.Balu |
0.33 |
The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary in the financial year -2022- 23. |
Mr.G.Ramachandran, Managing Director Mr. S.Nandakumar, Chief Financial Officer Ms. S.Rohini Priyadarshini,Company Secretary (till 31.10.2022) * Ms.C.S.Vijayalakshmi Company Secretary (from 01.11.2022) |
1.11 2.49 NA NA |
The percentage increase in the median remuneration of employees in the financial Year - 2022-23 |
10.19 |
|
The number of permanent employees on the rolls of Company as on 31.03.2023 |
252 |
|
Average percentage increase already made in the salaries of |
Average percentage increase already made in the |
10.10 |
employees other than the managerial personnel in the last financial |
salaries of employees other than the key managerial |
|
year and its comparison with the percentage increase in the |
personnel in the FY 2022-23. |
|
managerial remuneration and justification thereof |
Average percentage increase already made in the |
3.62 |
salaries of the key managerial personnel in the FY |
||
2022-23 |
||
*relieved from the services on 31.10.2022 |
AFFIRMATION THAT THE REMUNERATION IS AS PER THE REMUNERATION POLICY OF THE COMPANY
Company is adopting remuneration guidelines for fixing the remuneration as per the policies laid down by the Nomination and Remuneration Committee.
PARTICULARS AS REQUIRED UNDER RULE 3 OF THE COMPANIES (ACCOUNTS) RULES, 2014
A. Conservation of Energy
1. Steps taken and impact on conservation of energy
a. Post COVID, induction turbine alternator to utilize the energy in the steam let down for process use, was commissioned and approximately 5000 units a day is being produced, which resulted in a saving of approximately Rs.1 crore per annum.
b. Due to installation of filter press in the recycle stream, added last year, the distiller steam consumption has come down, resulting in a saving of steam, which will save about Rs.2 crores per annum.
2. Steps taken for utilizing alternative sources of energy
Your Company is implementing a system to co-fire of biomass and trials will commence in the next financial year 2023-24. This will avoid usage of coal of approximately 50,000 MTs in a year.
3. Capital investment in conservation energy
Further investment of Rs.100 lakhs is being made to fire biomass into the boiler.
4. The company has installed various Variable frequency drives to reduce the energy consumption in motors and also installed LED lamps to conserve energy.
B. Technology Absorption
(a) The Company has fully utilized the imported Technology of Hitachi Zosen, Japan which was imported in the year 1980.
(b) |
Expenditure on Research & Development |
|
(i) (ii) |
Capital Nil Recurring Nil |
|
(iii) |
Total Nil |
|
C. |
Foreign Exchange Earnings and outgo: |
|
(a) |
Foreign Exchange inflow: Rs. Nil lakhs |
|
(b) |
Foreign Exchange outflow: Rs. 17.36 lakhs |
No disclosure or reporting is required in respect of the following matters as there were no transactions on these items during the year
a. No significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companyâs operations in future
b. There was no issue of Equity shares with differential voting rights ACKNOWLEDGEMENTS
Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companyâs activities during the year under review. Your Directors also acknowledge gratefully the shareholders for their support and confidence reposed on your Company.
Statements in the Management Discussion and Analysis describing the Companyâs objectives, estimates, projections, expectations may be âforward-looking statementsâ within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that would make a difference to the Companyâs operations include economic conditions affecting demand-supply and price conditions in the domestic and overseas markets in which the Company operates, raw material availability and its prices, changes in the Governmental regulations, labour negotiations, tax laws and other statutes and economic development within India.
Mar 31, 2018
To
The Members
The Directors present the 45th Annual Report together with the Audited Accounts of the Company for the year ended 31st March, 2018.
FINANCIAL RESULTS
(Rs. In Crores)
DESCRIPTION |
2017-18 |
2016-17 |
Sales Turnover (Net of Excise Duty and Trade Discount) |
133.59 |
132.76 |
Gross Loss after meeting all expenses but before providing depreciation and interest |
39.21 |
29.58 |
Add: Interest |
3.21 |
3.19 |
Cash Loss |
42.42 |
32.77 |
Add: Depreciation for the year |
2.33 |
2.47 |
Extraordinary Items |
-- |
-- |
Net Profit / (Loss) for the year |
(44.75) |
(35.24) |
Accumulated Loss |
264.88 |
220.13 |
EPS & Diluted EPS |
(30.51) |
(24.25) |
DIVIDEND
Your Directors were not able to recommend any dividend in view of the accumulated losses.
MARKET SCENARIO
The international market prices were more or less same like last financial year and hence the Companyâs selling price of Soda Ash didnât undergo any significant change. Since the production was less, the Company could cater to the requirement of 1 or 2 major customers and generally market sale was low.
Due to the falling Ammonia prices, the Ammonium Chloride prices came down during the last financial year and it continued to be so in the current year also. The prices in India also have fallen and the imposition of GST has made the product costlier at the hands of the farmer and has made it difficult to penetrate the Indian market in comparison to open subsidized nitrogenous fertilizers. It is noted that the current selling prices in India is more or less same like export to South East Asia and hence the Company could probably sell the material without accumulation due to slow down of indigenous sale.
ENVIRONMENT AND SAFETY
The periodic audits as required under ISO 9001 have been carried out. WIND MILL
During the year 0.55 Lakh units were generated from Wind Turbine Power Generators at Gudimangalam, Tirupur District, as against 0.67 Lakh units generated in the previous year. The aging windmills are being refurbished for better results.
POWER PURCHASE
About 60% of the power was purchased from Group Captive Scheme during the financial year.
CAPTIVE SALT WORKS
During the financial year, 11,550 Tonnes of salt could be produced, as against 15,150 Tonnes produced last year. We have repaired some portions of the salt pans and it is expected that with the implementation of the RO plant and the repairs during the next financial year, the salt production would be higher next year.
NCLT/SEBI
Based on the application to NCLT, the Company applied to SEBI for granting necessary exemption for converting the funds bought in by the promoters into equity. The approval of the shareholders was obtained vide EGM held on 10th April, 2018 to enable this. The further directions of NCLT is awaited.
FIXED DEPOSIT
There was no outstanding deposit as at 31st March, 2018. The Company has neither accepted nor renewed any deposits during the year under review.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
Since there was no unpaid/unclaimed Dividend declared and paid last year, the provisions of Section 125 of the Companies Act, 2013 do not apply.
MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENT RELATES AND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relates on the date of this report.
STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY
The Statement was showing the details regarding the development and implementation of Risk Management Policy of the Company is furnished in Annexure 1 and attached to this report. The risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting.
Your Company is dependent primarily on SPIC for the supply of CO2 and for receiving the imported Ammonia through their storage system. Your Company has now implemented an independent CO2 Recovery facility which is operational from November 2016. This has reduced the risk considerably. The Board does not envisage any other major risks.
DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable as on date in view of the accumulated losses the Company has incurred.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013
There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
The transactions entered into during the financial year with related party as defined under the Companies Act, 2013 were in the ordinary course of business and at armâs length basis. There were no materially significant transactions during the financial year 2017-18 which were in conflict with the interests of the Company.
COMPANYâS POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES
The Companyâs Policy relating to appointment of Directors, payment of Managerial remuneration, Directorsâ qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 is furnished in Annexure 2 and is attached to this report
NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
The Company had four Board meetings during the financial year under review. Full details are given in the Corporate Governance Report.
DIRECTORSâ RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submits its responsibility Statement:-
a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;
c. the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d. the directors had prepared the annual accounts on a going concern basis; and
e. the Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Companyâs 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.
f. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary, Joint venture or Associate Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. G. Ramachandran, Managing Director who got re-elected during last Annual General Meeting held on 28th July, 2017, again retires at the forthcoming Annual General Meeting and being eligible offers himself for re-election.
There is no change among the Independent Directors and key managerial personnel during the year under review.
DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves for the continuance / appointment as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.
BOARD EVALUATION
Pursuant to the provisions of Section 149 read with Schedule IV of the Companies Act 2013 and conditions of the SEBI (LODR) Regulations 2015, the Independent Directors in their separate meeting held on 5th
February, 2018, had reviewed the performance of Non-Independent Director and the Board as a whole.
STATUTORY AUDITORS
M/S. MSKA & Associates, (formerly known as MZSK & Associates) Chartered Accountants, Chennai, (Registration No.105047W) have been appointed as Statutory Auditors of the Company in 44th Annual General meeting for a term of five years from the Financial year 201718 till the conclusion of the Annual General Meeting of the Company to be held in the year 2022.
SECRETARIAL AUDITOR
Mr. R Kannan has been appointed by the Board of Directors to carry out the Secretarial Audit for the year ended 31st March, 2018. Secretarial Auditorâs Report is annexed which forms part of this report.
COST AUDIT
As per the Government of Indiaâs directive, the Companyâs Cost Reports in respect of Fertilizer - Ammonium Chloride and Chemical -Soda Ash for the year ended 31st March, 2018 are being audited by the Cost Auditor Mr P R Tantri, who was appointed by the Board with the approval of the Government of India.
EXPLANATIONS OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS
There was no qualification, reservations or adverse remarks made by the Statutory Auditors, M/s. MSKA & Associates and Secretarial Auditor, Mr. R. Kannan, Practicing Company Secretary, in their reports.
DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Audit Committee consists of M/s.B. Narendran, S. Shankar and S. Asokan all of whom are Independent Directors. During the year Dr. RM Krishnan has been co-opted as a Member of the Audit Committee with effect from 12.05.2017.
The Company has established a vigil mechanism and oversees through a committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co-employees and the Company. Policy is given in Annexure 3.
SHARES
The Company has not bought back any of its shares during the year under review.
The Company has not issued any âSweat Equityâ Shares during the year under review.
No Bonus Shares were issued during the year under review.
The Company has not provided any Stock Option Scheme to the employees.
ANNUAL RETURN
The extracts of Annual Return in Form MGT pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure 4 and is attached to this Report.
PARTICULARS OF EMPLOYEES
The Company has no Employees whose salary exceeds Rupees Five lakhs per month.
Disclosures under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
Ratio of the Remuneration of each director to the median Remuneration of the employees of the company for the financial year 2017-18 |
Mr.G.Ramachandran - Managing Director 23.40% |
||
Percentage increase in Remuneration of each Director, Chief Financial Officer, Company Secretary in the financial year 2017-18 |
Managing Director : 2% Chief Financial Officer : 11% Company Secretary : 6% |
||
Percentage increase in the median Remuneration of employees in the financial year 2017-18 |
(3.53) |
||
Number of Permanent Employees on the Rolls of the Company |
209 |
||
Explanation on the relationship between average increase in remuneration and company performance |
During the year, increase in sales turnover is due to more number of days the Plant was operated. Decrease in average remuneration is due to salary arrears included in the previous year. |
||
Comparison of the Remuneration of the key Managerial Personnel against the performance of the company. |
The remuneration to the KMP are considered reasonable taking into account various parameters including the performance of the Company, qualification, experience and contribution of the respective KMPS |
||
Variations in the market capitalization of the company, price earnings ratio as at the closing date of the current financial year / previous financial year and percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer in case of listed companies and in case of un-listed companies, the variation in the net worth of the company as at the close of current / previous financial year |
Description |
2017-18 |
2016-17 |
Market Cap (Rs. in lakhs) |
1821.37 |
1975.24 |
|
Price - Earnings Ratio |
(0.40) |
(0.55) |
|
Last Issue Price per share |
Rs.10.00 |
||
Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration. |
Average Managerial Remuneration, other than managerial personnel remains more or less the same as that of previous year. |
||
Comparison of each remuneration of the Key Managerial Personnel against the performance of the Company. |
The remuneration to the KMP are considered reasonable taking into account the various parameters including the performance of the Company and the qualification, experience, contribution of the respective KMP. |
||
The key parameters for any variable component of remuneration availed by the Directors. |
Sitting Fees. |
||
The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year. |
The remuneration of an employee not being a Director but in receipt of remuneration in excess of the Director was 1.07 times of the remuneration of the highest paid director - viz- Managing Director |
AFFIRMATION THAT THE REMUNERATION IS AS PER THE REMUNERATION POLICY OF THE COMPANY
Company is adopting remuneration guidelines for fixing the remuneration as per the policies laid down by the Nomination and Remuneration Committee.
PARTICULARS AS REQUIRED UNDER RULE 3 OF THE COMPANIES (ACCOUNTS) RULES, 2014
A. Conservation of Energy
1. Steps taken or impact on conservation of energy
Crystallizers insulation and operation are being optimized to reduce the energy consumption. The CO2 production has enabled the Company to reduce the venting of circulating gas, which has improved the efficiency. Use of Centrifugal compressors is still under evaluation.
2. Steps taken for utilizing alternative sources of energy
A Project, jointly with Group Companies, is under consideration for production and utilization of solar energy.
3. Capital investment in conservation energy
CO2 plant reduces the wastage of CO2, thereby saves energy indirectly. No direct investment have been made during the Financial Year.
B. Technology Absorption
a) The Company has fully utilized the imported Technology of Hitachi Zosen, Japan which was imported in the year 1980.
b) Expenditure on Research & Development
i) Capital Nil
ii) Recurring Nil
iii) Total Nil
C Foreign Exchange Earnings and outgo:
a) Foreign Exchange inflow: Rs. 20.36 Crores
b) Foreign Exchange outflow: Rs. 2.80 Crores
ACKNOWLEDGEMENTS
Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companyâs activities during the year under review. Your Directors also acknowledge gratefully the shareholders for their support and confidence reposed on your Company.
Declaration
No case of sexual harassment was reported during the year.
The Company has followed Indian Accounting Standard (Ind As) for this Financial Year and the previous years figures were reclassified as per Ind As.
The Company has followed the applicable Secretarial Standards.
For and on behalf of the Board of Directors
Chennai B. NARENDRAN G. RAMACHANDRAN
16th May, 2018 Director Managing Director
Mar 31, 2017
To
The Members
The Directors present the 44th Annual Report together with the Audited Accounts of the Company for the year ended 31st March, 2017.
FINANCIAL RESULTS
The following are the financial highlights:- (Rupees in Crores)
DESCRIPTION |
2016-17 |
2015-16 |
Sales Turnover (Net of Excise Duty and Trade Discount) |
132.55 |
156.54 |
Gross Loss after meeting all expenses but before providing depreciation and interest |
30.39 |
15.06 |
Add: Interest |
1.70 |
5.13 |
Cash Loss |
32.09 |
20.19 |
Add: Depreciation for the year |
2.42 |
2.12 |
Extraordinary Items |
-- |
55.95 |
Net Profit / (Loss) for the year |
(34.51) |
33.64 |
Accumulated Loss |
197.31 |
162.69 |
EPS & Diluted EPS |
(24.16) |
21.90 |
During the Financial Year, since November 2016, the Plant operated only with raw material CO2 gas from the captive CO2 Plant without any supplies from SPIC. Even though the Plants operated continuously, the capacity utilization was low due to the teething problems in the CO2 Plant, which are being attended. Even during the period till November, when CO2 gas was received from SPIC, the capacity utilization was low due to restricted availability of the raw material. SPIC restarted their Plant only by May 2016 and hence about 45 days of production was lost at the beginning of the year and in January 2017, when water supply was discontinued suddenly by TWAD, the Plants were shutdown for 9 days till the time alternate supplies were arranged. Thus totally, including the maintenance stoppages, production was lost for 73 days. Because of the high cost of purchased water from Private Sources, increasing coal prices and decreasing realization on the Ammonium Chloride sales, the loss for the last quarter was high and for the year it was Rs.34.51 crores. The production and sales were lower compared to last year. During the year 45,463 MT of total Soda Ash and 40,795 MT of Ammonium Chloride were produced.
PRODUCTION AND SALES
The details of production and sales of the finished products for the financial year are as under:
(In Tonnes)
Product |
Production |
Sales |
||
2016-17 |
2015-16 |
2016-17 |
2015-16 |
|
Soda Ash (Light) |
44,395 |
49,275 |
46,018 |
51,471 |
Soda Ash (Dense) |
1,047 |
1,940 |
1,235 |
1,697 |
Ammonium Chloride (Fertilizer) |
40,795 |
45,630 |
41,613 |
38,325 |
Sodium Bicarbonate |
565 |
1,518 |
576 |
1,491 |
DIVIDEND
Your Directors were not able to recommend any dividend in view of the accumulated losses.
MARKET SCENARIO
Even though there was a down trend in the international market price, your Company maintained the price line in view of the lower quantum of product to be sold. The support from the larger consumers was helpful. The prices are expected to improve in the coming Financial Year.
The prices of Ammonium Chloride dramatically scaled down due to decreasing international Ammonia price. China could offer their product at a price which is only 60% of what prevailed in the last financial year. It impacted Company''s capability to export and at the same time the local price had to be readjusted in line with the international price to maintain the indigenous sales. The revenue from exports also went down due to this large drop in selling price.
FUTURE OUTLOOK
The sales in the southern states of India are improving. Your Company can market the entire production when production is improved. Currently, the new entrants and imports can be curtailed for all the grades of product that the Company produces and markets. Hence the outlook is good for improving the sales.
OPPORTUNITIES AND THREATS
Since the markets of southern and eastern states of India are met only by imports or from expensive local modes of transport from western India, it is possible for the Company to increase its presence in these states when production improves.
The principal threat has long been the single source availability of CO2 from SPIC. With the commissioning of the captive CO2 Plant, the perception of threat has come down. Once the technology is perfected, attempt can be made to increase the CO2 production and the Soda Ash Production. This will position the Company better. The Ammonia import facility of Green Star now consists of a single tank and construction of the second tank which is likely to begin soon will further improve the situation.
ENVIRONMENT AND SAFETY
The periodic audits as required under ISO 9001 have been carried out.
WIND MILL
During the year 0.67 lakh units were generated from Wind Turbine Power Generators at Gudimangalam, Tirupur District, as against 2.28 lakh units generated in the previous year.
POWER PURCHASE
Your Company is drawing power under Group Captive Scheme from private power producer. Necessary investments were made based on the approval granted by you during the last AGM. The power is drawn from the month of October 2016.
CAPTIVE SALT WORKS
During the financial year, 15,150 MT of salt could be produced, bettering the 7,458 MT produced last year. We expect to do well in the ensuing year due to the early production achieved and also due to change of the pumps and repair of the salt pans wherever necessary.
BIFR
The Company filed the Draft Rehabilitation Scheme in August 2015. However, further hearings at BIFR did not take place. Your Company has resubmitted an updated DRS with the annual accounts for the year 2015-16 in May 2016. IDBI (Operating Agency), after appraisal and plant visit, forwarded it to BIFR for their consideration. However, before BIFR could take it up for discussions, Sick Industrial Companies (Special Provisions) Act, 1985 was repealed and reference to National Company Law Tribunal (NCLT) is needed with effect from 1.12.2016. Your Company has now petitioned to both NCLT & SEBI for direction to carry forward the recommendations of OA / BIFR., as application under the Insolvency Act cannot be made.
FIXED DEPOSIT
There was no outstanding deposit as at 31st March, 2017. The Company has neither accepted nor renewed any deposits during the year under review.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
Since there was no unpaid/unclaimed Dividend declared and paid last year, the provisions of Section 125 of the Companies Act, 2013 do not apply.
MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENT RELATES AND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relates on the date of this report.
STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY
The Statement was showing the details regarding the development and implementation of Risk Management Policy of the Company is furnished in Annexure 1 and attached to this report. The risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting.
Your Company is dependent primarily on SPIC for the supply of CO2 and for receiving the imported Ammonia through their storage system. Your Company has now implemented an independent CO2 Recovery facility which is operational from November 2016. This has reduced the risk considerably. The Board does not envisage any other major
DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable as on date in view of the accumulated losses the Company has incurred.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013
There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
The Company does not fall under the related party with any company.
COMPANY''S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES
The Company''s Policy relating to appointment of Directors, payment of Managerial remuneration, Directors'' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 is furnished in Annexure 2 and is attached to this report.
NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
The Company had four Board meetings during the financial year under review. Full details are given in the Corporate Governance Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submits its responsibility Statement:-
a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;
c) The directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d) The directors had prepared the annual accounts on a going concern basis; and
e) The Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to 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.
f) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary, Joint venture or Associate Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. G. Ramachandran, Managing Director who got re-elected during last Annual General Meeting held on 4th August 2016, again retires at the forthcoming Annual General Meeting and being eligible offers himself for re-election.
There is no change among the Independent Directors and key managerial personnel during the year under review.
DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves for the continuance / appointment as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.
BOARD EVALUATION
Pursuant to the provisions of Section 149 read with Schedule IV of the Companies Act 2013 and conditions of the SEBI (LODR) Regulations 2015, the Independent Directors in their separate meeting held on 31st January, 2017, had reviewed the performance of Non-Independent Director and the Board as a whole.
STATUTORY AUDITORS
As per the provisions of Section 139(2) of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, of Statutory Auditors are eligible to be appointed for two terms of five years each provided they are a firm and not an individual. M/s. CNGSN & Associates LLP a firm of Chartered Accountants was the Company''s auditors since 2003-04 and hence has completed the tenure of 10 years, Moreover they have also passed the maximum time allowed for the initial transition period of 3 years from the notification of the Companies Act, 2013 and Rules thereon.
Hence the Board of Directors, on the recommendation of the Audit Committee, at its meeting held today has resolved to appointment
M/s MZSK & Associates, Chartered Accountants, Chennai for a period of five years from 2017-18 to 2021-22. Their appointment and remuneration are subject to your approval. M/s MZSK & Associates Chartered Accounts, Chennai have well been experienced and have sound integrity to conduct the Statutory Audit.
SECRETARIAL AUDITOR
Mr. R Kannan has been appointed by the Board of Directors to carry out the Secretarial Audit for the year ended 31st March, 2017. Secretarial Auditor''s Report is annexed which forms part of this report.
COST AUDIT
As per the Government of India''s directive, the Company''s Cost Reports in respect of Fertilizer - Ammonium Chloride and Chemical - Soda Ash for the year ended 31st March, 2017 are being audited by the Cost Auditor Mr. P R Tantri, who was appointed by the Board with the approval of the Government of India.
EXPLANATIONS OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS
There was no qualification, reservations or adverse remarks made by the Statutory Auditors, M/s. CNGSN & Associates LLP and Secretarial Auditor, Mr. R. Kannan, Practicing Company Secretary, in their reports.
DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM/WHISTLE BLOWER
Disclosures under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
Ratio of the Remuneration of each director to the median Remuneration of the employees of the company for the financial year 2016-17 |
Mr. G Ramachandran, Managing Director 24.65 |
||
Percentage increase in Remuneration of each Director, Chief Financial Officer, Company Secretary in the financial year 2016-17 |
Managing Director 128% Chief Financial Officer 5% Company Secretary 1% |
||
Percentage increase in the median Remuneration of employees in the financial year 2016-17 |
8.52% |
||
Number of Permanent Employees on the Rolls of the Company |
214 |
||
Explanation on the relationship between average increase in remuneration and company performance |
Remuneration is less when compared to last year due to retirements and fresh replacements. |
||
Comparison of the Remuneration of the key Managerial Personnel against the performance of the company. |
The remuneration to the KMP are considered reasonable taking into account various parameters including the performance of the Company, qualification, experience and contribution of the respective KMPS |
||
Variations in the market capitalization of the company, price earnings ratio as at the closing date of the current financial year / previous financial year and percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer in case of listed companies and in case of un-listed companies, the variation in the net worth of the company as at the close of current / previous financial year |
Description |
2016-17 |
2015-16 |
Market Cap (Rs. in lakhs) |
1975.24 |
728.94 |
|
Price - Earnings Ratio |
(0.55) |
0.22 |
|
Last Issue Price per share |
Rs.10.00 |
POLICY
The Audit Committee consists of M/s. B. Narendran, S. Shankar and S. Asokan all of whom are Independent Directors.
The Company has established a vigil mechanism and oversees through a committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co-employees and the Company. Policy is given in Annexure 3.
SHARES
The Company has not bought back any of its shares during the year under review.
The Company has not issued any "Sweat Equity" Shares during the year under review.
No Bonus Shares were issued during the year under review.
The Company has not provided any Stock Option Scheme to the employees.
ANNUAL RETURN
The extracts of Annual Return in Form MGT pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure 4 and is attached to this Report.
PARTICULARS OF EMPLOYEES
AFFIRMATION THAT THE REMUNERATION IS AS PER THE REMUNERATION POLICY OF THE COMPANY
Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration. |
Average Managerial Remuneration, other than managerial personnel remains more or less the same as that of previous year. |
Comparison of each remuneration of the Key Managerial Personnel against the performance of the Company. |
The remuneration to the KMP are considered reasonable taking into account the various parameters including the performance of the Company and the qualification, experience, contribution of the respective KMP. |
The key parameters for any variable component of remuneration availed by the Directors. |
Sitting Fees. |
The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year. |
Nil |
Company is adopting remuneration guidelines for fixing the remuneration as per the policies laid down by the Nomination and Remuneration Committee.
PARTICULARS AS REQUIRED UNDER RULE 3 OF THE COMPANIES (ACCOUNTS) RULES, 2014 A. Conservation of Energy
1. Steps taken or impact on conservation of energy:
Crystallizerâs insulation and operation are being optimized to reduce the energy consumption. The CO2 production has enabled the Company to reduce the venting of circulating gas, which has improved the efficiency. Use of Centrifugal compressors is still under evaluation.
2. Steps taken for utilizing alternate sources of energy:
A Project, jointly with Group Companies, is under consideration for production and utilization of solar energy.
3. Capital investment in conservation of energy:
CO2 plant reduces the wastage of CO2, thereby saves energy indirectly. No direct investment has been made during the Financial Year.
B. Technology Absorption
(a) The Company has fully utilized the imported Technology of Hitachi Zosen, Japan which was imported in the year 1980.
(b) Expenditure on Research & Development
(i) Capital Nil
(ii) Recurring Nil
(iii) Total Nil
C. Foreign Exchange Earnings and outgo:
(a) Foreign Exchange inflow: Rs.13.03 Crores
(b) Foreign Exchange Outflow: Rs.14.27 Crores
ACKNOWLEDGEMENTS
Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Company''s activities during the year under review. Your Directors also acknowledge gratefully the shareholders for their support and confidence reposed on your Company.
DISCLAIMER
Statements in the Management Discussion and Analysis describing the Company''s objectives, estimates, projections, expectations may be "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that would make a difference to the Company''s operations include economic conditions affecting demand-supply and price conditions in the domestic and overseas markets in which the Company operates, raw material availability and its prices, changes in the Governmental regulations, labour negotiations, tax laws and other statutes and economic development within India.
For and on behalf of the Board of Directors
Chennai B. NARENDRAN G. RAMACHANDRAN
17th May, 2017 Director Managing Director
Mar 31, 2015
Dear Members,
The Directors present the 42nd Annual Report together with the Audited
Accounts of the Company for the year ended 31st March, 2015.
FINANCIAL RESULTS
The following are the financial highlights:-
(Rupees in Crores)
DESCRIPTION 2014-15 2013-14
Sales Turmover(Net of
Excise Duty and Trade 132.36 26.06
Discount)
Gross Loss after meeting
all expenses but before
providing depreciation and
interest 6.72 16.79
Add: Interest 8.41 9.51
Cash Loss 15.13 26.30
Add: Depreciation for the
year 1.99 3.98
Loss for the year 17.12 30.28
Accumulated Loss 196.33 179.21
EPS & Diluted EPS (12.41) (21.31)
In the current Financial Year, your Company performed better compared
to last year even though it had encountered shutdown for want of raw
material Carbon-di-oxide gas (CO2) for 119 days and low production rate
since restart in Jan.'15. Your Company had to suspend production from
1st October, 2014 to 13th January, 2015 as the Ammonia Plant of SPIC
was under shutdown, which supplies the raw material CO2. SPIC
recommenced production in the second week of January 2015 and your
Company also started production immediately thereafter. However,
required CO2 was not available from SPIC and hence the Plant operated
for majority of the days till 31st March, 2015 at around 50% capacity
utilisation only. Thus during the year, only 48,285 MT of Soda Ash and
40,415 MT of Ammonium Chloride (Fertilizer) could be produced.
PRODUCTION AND SALES
The details of production and sales of the finished products for the
financial year are as under:
(In Tonnes)
Product Production Sales
2014-15 2013-14 2014-15 2013-14
Soda Ash 48,285 9,775 43,782 9,685
(Light)
Soda Ash  ---  6
(Dense)
Ammonium 40,415 7,672 34,734 4,797
Chloride
(Fertiliser)
Sodium  ---  18
Bicarbonate
DIVIDEND
Your Directors were not able to recommend any dividend in view of the
continued losses incurred by the Company.
MARKET SCENARIO
Greater than usual availability of Soda Ash in the southern market from
Europe and China, comparatively at a lower price, the infrequent
operation of your Plant, were dampeners and resulted in lower sales.
Some of the committed users of Soda Ash of your Company are continuing
to buy and hence it is felt that the sales can be improved and
stabilised once continuous production is ensured which will add to the
confidence level of customers.
Ammonium Chloride (Fertilizer) is marketed through Greenstar
Fertilizers Limited as already reported in the last AGM. The market is
steady and it is expected that both Soda Ash and Ammonium Chloride
would do well in the coming financial year.
FUTURE OUTLOOK
Your Company markets its Soda Ash in all the four southern states of
India. The market conditions seem to have improved but your Company has
to encounter the large imports that have started arriving. Due to this,
it is expected that the selling price of Soda Ash may slightly get
depressed during the next financial year.
OPPORTUNITIES AND THREATS
By improved operation and higher output, the cost of production can be
brought down and the improved market conditions present an opportunity
for sale of the entire production in southern markets displacing
imports. However, the continuous dumping of products from Eastern
Europe and China is a big threat and can destabilise and depress the
selling price of Soda Ash.
ENVIRONMENT AND SAFETY
The periodic audits as required for ISO 9001 have been carried out and
the recertification has been obtained.
WIND MILL
During the year 1.34 lakh units were generated from 5 Nos. of 250 KW
Wind Turbine Power Generators at Gudimangalam, Tirupur District, as
against 2.58 lakh units generated in the previous year.
CAPTIVE SALT WORKS
The production during the financial year was only 9,700 MT. The regular
production started late and also ended soon in Feb.'15 due to
unseasonal rains. The salt works require considerable investment for
replacement of the bore well pumps which would be taken up soon to
improve the production further.
BIFR
As already reported, ICICI Bank, IDBI Bank and HDFC have assigned their
loans to Edelweiss ARC (EW) and the Company is in the process of
settling the OTS offer from them and is expected to be completed in the
coming Financial Year. TMB also offered a One Time Settlement which was
availed and completed on 31st March, 2015. The funds generated by the
sale of the 5th floor of the Corporate Office, which was held in a No
Lien Account with IDBI, was also utilised in the above settlement, in
addition to raising the balance money through internal generation.
FIXED DEPOSIT
There was no outstanding deposit as at 31st March, 2015. However an
amount of Rs.0.08 lakhs remains unclaimed (representing one deposit).
The Company has neither accepted nor renewed any deposits during the
year under review.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION
FUND
Since there was no unpaid/unclaimed Dividend declared and paid last
year, the provisions of Section 125 of the Companies Act, 2013 do not
apply.
MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION
OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH
THIS FINANCIAL STATEMENT RELATES AND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of
the Company occurred between the end of the financial year to which
this financial statement relates and the date of this report.
STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT
POLICY OF THE COMPANY
The Statement showing the details regarding the development and
implementation of Risk Management Policy of the Company is furnished in
Annexure 1 and attached to this report. The risk management includes
identifying types of risks and its assessment, risk handling and
monitoring and reporting.
Your Company is dependent primarily on SPIC for the supply of CO2 and
also for receiving the imported Ammonia through their storage system.
Your Company is now implementing an independent CO2 Recovery facility
which is likely to be operational by the end of the ensuing Financial
Year. This may reduce the risk considerably. The Board does not
envisage any other major risks.
DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Company has not developed and implemented any Corporate Social
Responsibility initiatives as the said provisions are not applicable as
on date in view of the continuous losses the Company has incurred,
including the year ended 31st March, 2015.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186
OF THE COMPANIES ACT, 2013
There were no loans, guarantees or investments made by the Company
under Section 186 of the Companies Act, 2013 during the year under
review and hence the said provision is not applicable.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
The Company has procured CO2 from Southern Petrochemical Industries
Corporation Limited (SPIC), a Related Party and also used their
facility for pumping Ammonia. The value of both the transactions is
Rs.482.31 lakhs which is less than 10% of the turnover of the Company
for the year under review. The transactions were done at 'arms' length.
Accordingly Directors are of the view that, during the year under
review, this is not coming under the purview of Section 188 of the
Companies Act, 2013.
COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF
REMUNERATION AND DISCHARGE OF THEIR DUTIES
The Company's Policy relating to appointment of Directors, payment of
Managerial remuneration, Directors' qualifications, positive
attributes, independence of Directors and other related matters as
provided under Section 178(3) of the Companies Act, 2013 is furnished
in Annexure 2 and is attached to this report
NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
During the year, four meetings of the Board of Directors were held.
Full details are given in the Corporate Governance Report.
DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies
Act, 2013 the Board hereby submits its Responsibility Statement:-
a) in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to
material departures;
b) the directors had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit and loss
of the Company for that period;
c) the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
d) the directors had prepared the annual accounts on a going concern
basis;
e) the Directors, had laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively. Internal financial control
means the policies and procedures adopted by the Company for ensuring
the orderly and efficient conduct of its business including adherence
to 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 and
f) the directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary, Joint Venture or Associate
Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Thiru G Ramachandran, Managing Director, who got re-elected during last
Annual General Meeting held on 14th August, 2014, again retires at the
forthcoming Annual General Meeting and being eligible offers himself
for re-election.
Tmt. Rita Chandrasekar, who was co-opted as Additional Director on 30th
March, 2015, holds the said office till the date of the Annual General
Meeting. A notice has been received from a member proposing her
candidature for her reappointment.
At the Meeting of the Board of Directors held on 27th May, 2014 Thiru G
Ramachandran, Managing Director, Thiru S Nandakumar, Chief Financial
Officer and Thiru S Raghavan, Company Secretary were designated as "Key
Managerial Personnel" of the Company pursuant to Sections 2(51) and 203
of the Companies Act, 2013 read with the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
DECLARATION OF INDEPENDENT DIRECTORS AND BOARD EVALUATION
The Independent Directors have submitted their disclosures to the Board
that they fulfill all the requirements as stipulated in Section 149(6)
of the Companies Act, 2013 so as to qualify themselves for their
continuance / appointment as Independent Directors under the provisions
of the Companies Act, 2013 and the relevant rules.
Pursuant to the procisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, Independent Directors at their meeting without
the participation of the Non-independent Director and Management,
considered/evaluated the Board's performance and Non-independent
Director.
The Board evaluated its own performance and its Committees.
STATUTORY AUDITORS
M/s CNGSN & Associates LLP, Chartered Accountants, Chennai were
appointed as Statutory Auditors for a period of one year in the Annual
General Meeting held on 14th August, 2014. Their continuance of
appointment and payment of remuneration are to be confirmed and
approved in the ensuing Annual General Meeting. The Company has
received a certificate from the above Auditors to the effect that if
they are reappointed, it would be in accordance with the provisions of
Section 141 of the Companies Act, 2013.
SECRETARIAL AUDITOR
Thiru R Kannan has been appointed by the Board of Directors to carry
out the Secretarial Audit for the year ended 31st March, 2015.
Secretarial Auditor's Report is annexed which forms part of this
report.
COST AUDIT
As per the Government of India's directive, the Company's Cost Records
in respect of Fertiliser - Ammonium Chloride and Chemical - Soda Ash
for the year ended 31st March, 2015 are being audited by the Cost
Auditor Thiru P R Tantri, who was appointed by the Board with the
approval of the Government of India.
EXPLANATIONS OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE
REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTISING COMPANY
SECRETARY IN THEIR REPORTS
There was no qualification, reservations or adverse remarks made by the
Statutory Auditors, M/s. CNGSN & Associates LLP and Secretarial
Auditor, Thiru. R. Kannan, Practising Company Secretary, in their
reports.
DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL
MECHANISM/WHISTLE BLOWER POLICY
The Audit Committee consists of Tvl. B. Narendran, S. Shankar and S.
Asokan all of whom are Independent Directors.
The Company has established a vigil mechanism and oversees through a
committee, the genuine concerns expressed by the employees and other
Directors. The Company has also provided adequate safeguards against
victimization of employees and Directors who express their concerns.
The Company has also provided direct access to the Chairman of the
Audit Committee on reporting issues concerning the interests of the
Company's employees and the Company. Policy is given in Annexure 3.
SHARES
The Company has not bought back any of its shares during the year under
review.
The Company has not issued any "Sweat Equity" Shares during the year
under review.
No Bonus Shares were issued during the year under review.
The Company has not provided any Stock Option Scheme to the employees.
ANNUAL RETURN
The extracts of Annual Return in Form MGT - 9 pursuant to the
provisions of Section 92 read with Rule 12 of the Companies
(Management and Administration) Rules, 2014 is furnished in Annexure 4
and is attached to this Report.
PARTICULARS OF EMPLOYEES
The Company has no Employees whose salary exceeds the limits prescribed
under Rule 5(2) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014.
(i) THE RATIO OF THE REMUNERATION OF EACH DIRECTOR TO THE MEDIAN
REMUNERATION OF THE EMPLOYEES OF THE COMPANY FOR THE FINANCIAL YEAR -
2014-15.
Sl.No. Name of the Director Ratio
1 Dr R M Krishnan 0.09
2 Mr S Shankar 0.09
3 Mr S Asokan 0.14
4 Mr B Narendran 0.18
5 Mr G Ramachandran 0.76
(ii) THE PERCENTAGE INCREASE IN REMUNERATION OF EACH DIRECTOR, CHIEF
FINANCIAL OFFICER, CHIEF EXECUTIVE OFFICER, COMPANY SECRETARY OR
MANAGER, IF ANY, IN THE FINANCIAL YEAR - 2014-15.
Sl.No. Particulars %
1 Dr R M Krishnan NIL
2 Mr S Shankar NIL
3 Mr S Asokan NIL
4 Mr B Narendran NIL
5 Mr G Ramachandran NIL
6 Chief Financial Officer NIL
7 Company Secretary 11%
(iii) THE PERCENTAGE INCREASE IN THE MEDIAN REMUNERATION OF EMPLOYEES
IN THE FINANCIAL YEAR - 2014-15.
Sl.No. Particulars % Increase
1 Employees Median Remuneration - 4.26
Increase in the FY - 2014-15
(iv) THE NUMBER OF PERMANENT EMPLOYEES ON THE ROLLS OF THE COMPANY
Sl.No. Particulars Total No of
employees
1 Number of Employees - As on 211
31.03.2015
(v) THE EXPLANATION ON THE RELATIONSHIP BETWEEN AVERAGE INCREASE IN
REMUNERATION AND COMPANY PERFORMANCE.
(Rs. in lakhs)
Sl.No. Particulars 2014-15 2013-14
1 Sales Turnover 13,236.16 2,605.61
2 Average Remuneration 5.97 3.78
During the financial year 2014-15, increase in sales turnover is due to
more number of days the plant was operated, resulting in increase in
production man hours and consequential increase in remuneration. Also
wage revision settlement completed in the year 2014-15 for the last 6
years resulted in increase in remuneration. Percentage increase in
average remuneration is 57.78% which is due to inclusion of arrears of
salary consequent to fresh wage settlement for the past 6 years.
(vi) COMPARISON OF THE REMUNERATION OF THE KEY MANAGERIAL PERSONNEL
AGAINST THE PERFORMANCE OF THE COMPANY.
(Rs. in lakhs)
Sl.No. Particulars 2014-15
1 Sales Turnover 13,236.16
2 Remuneration of Key Managerial 22.62
Personnel
Note: Key Managerial Personnel consists of 3 persons viz:- Managing
Director, Chief Financial Officer & Company Secretary.
(vii) VARIATIONS IN THE MARKET CAPITALISATION OF THE COMPANY, PRICE
EARNINGS RATIO AS AT THE CLOSING DATE OF THE CURRENT FINANCIAL YEAR /
PREVIOUS FINANCIAL YEAR AND PERCENTAGE INCREASE OVER DECREASE IN THE
MARKET QUOTATIONS OF THE SHARES OF THE COMPANY IN COMPARISON TO THE
RATE AT WHICH THE COMPANY CAME OUT WITH THE LAST PUBLIC OFFER IN CASE
OF LISTED COMPANIES, AND IN CASE OF UN-LISTED COMPANIES, THE VARIATIONS
IN THE NET WORTH OF THE COMPANY AS AT THE CLOSE OF CURRENT / PREVIOUS
FINANCIAL YEAR
VARIATIONS IN MARKET CAPITALISATON
Sl.No. Month Average Share Market
Price Capitalisation
Rs. Rs. in lakhs
1 April 2014 2.56 378.77
2 May 2014 3.02 446.09
3 June 2014 4.02 594.05
4 July 2014 5.24 775.30
5 August 2014 6.43 951.37
6 September 2014 9.01 1,333.10
7 October 14 7.89 1,167.39
8 November 2014 6.78 1,002.42
9 December 2014 5.00 739.79
10 January 2015 4.27 631.78
11 February 2015 4.99 737.57
12 March 2015 3.72 550.40
PRICE EARNINGS RATIO
Sl.No. Particulars 2014-15 2013-14
1 Price Earnings Ratio (0.32) (0.10)
(viii) AVERAGE PERCENTILE INCREASE ALREADY MADE IN THE SALARIES OF
EMPLOYEES OTHER THAN THE MANAGERIAL PERSONNEL IN THE LAST FINANCIAL
YEAR AND ITS COMPARISON WITH THE PERCENTILE INCREASE IN THE MANAGERIAL
REMUNERATION AND JUSTIFICATION THEREOF AND POINT OUT IF THERE ARE ANY
EXCEPTIONAL CIRCUMSTANCES FOR INCREASE IN THE MANAGERIAL REMUNERATION
Rs. in Lakhs
Sl.No. Particulars 2014-15 2013-14
1 a) Average remuneration
of Personnel other than
Managerial Personnel 3.61 3.59
b) Median remuneration
of Personnel other than
Managerial Personnel 3.84 3.79
2 a) Average remuneration
of Managerial
Personnel 7.62 7.55
b) Median remuneration
of Managerial Personnel 7.33 6.00
(ix) COMPARISON OF EACH REMUNERATION OF THE KEY MANAGERIAL PERSONNEL
AGAINST THE PERFORMANCE OF THE COMPANY.
(Rs. in Lakhs)
Sl.No. Particulars 2014-15
1 Performance of the Company-Sales 13,236.16
Turnover
2 Remuneration of each Key Managerial
personnel
Managing Director 3.60
Chief Financial Officer 11.25
Company Secretary 7.77
(x) THE KEY PARAMETERS FOR ANY VARIABLE COMPONENT OF REMUNERATION
AVAILED BY THE DIRECTORS
Variable Component of Remuneration availed by Sitting Fees
Non-Executive Directors
(xi) THE RATIO OF THE REMUNERATION OF THE HIGHEST PAID DIRECTOR TO THAT
OF THE EMPLOYEES WHO ARE NOT DIRECTORS BUT RECEIVE REMUNERATION IN
EXCESS OF THE HIGHEST PAID DIRECTOR DURING THE YEAR
Sl.No. Name of The Employee Ratio of
Director Remuneration
1 G.Ramachandran GM (W) 0.272
C F O 0.270
(xii) AFFIRMATION THAT THE REMUNERATION IS AS PER THE REMUNERATION
POLICY OF THE COMPANY.
Company is adopting remuneration guidelines for fixing the remuneration
as per the policies laid down by the Remuneration Committee.
CHANGE OF NAME OF THE COMPANY
The Logo of the Company has been changed and the Directors intend to
change the name of the Company from TUTICORIN ALKALI CHEMICALS AND
FERTILISERS LIMITED to TUTICORIN ALKALI CHEMICALS AND FERTILIZERS
LIMITED subject to your approval. A Resolution has been proposed for
your approval in the ensuing Annual General Meeting.
ACKNOWLEDGEMENTS
Your Directors place on record their sincere thanks to bankers,
business associates, consultants, and various Government Authorities
for their continued support extended to your Company's activities
during the year under review. Your Directors also acknowledge
gratefully the shareholders for their support and confidence reposed on
your Company.
DISCLAIMER
Statements in the Management Discussion and Analysis describing the
Company's objectives, estimates, projections, expectations may be
"forward-looking statements" within the meaning of applicable
securities laws and regulations. Actual results could differ materially
from those expressed or implied. Important factors that would make a
difference to the Company's operations include economic conditions
affecting demand-supply and price conditions in the domestic and
overseas markets in which the Company operates, raw material
availability and its prices, changes in the Governmental regulations,
labour negotiations, tax laws and other statutes and economic
development within India.
For and on behalf of the Board of Directors
B. NARENDRAN G. RAMACHANDRAN
Director Managing Director
chennai
20th May,2015
Mar 31, 2014
The Members
The Directors present the 41st Annual Report together with the Audited
Accounts of the Company for the year ended 31st March, 2014.
Financial Results
The following are the financial highlights:-
(Rupees in Crores)
DESCRIPTION 2013-14 2012-13
Sales Turnover (Net of
Excise Duty and Trade 26.06 155.91
Discount)
Gross Loss after meeting
all expenses but before
providing depreciation and
interest 16.79 9.12
Add: Interest 9.51 7.52
Cash Loss 26.30 16.64
Add: Depreciation for the 3.98 4.53
year
Loss for the year 30.28 21.17
Accumulated Loss 179.21 148.93
The year had to encounter a low production and sales scenario. Only
Rs.26.06 crores of sales turnover could be achieved. The Plants, which
stopped production on 1st March, 2013 due to shutdown of the Ammonia
Plant of SPIC, could be restarted only in the month of October''13.
After a brief 3 weeks'' operation, again it was shutdown as supply of
CO2 from SPIC ceased and recommenced operation on 14th February,''14.
Thus in 62 days of operation during the Financial Year, only 9775 MT of
Soda Ash and 7672 MT of Ammonium Chloride (Fertiliser) could be
produced. Measures were taken to reduce the overheads during the
closure/non-operative period and the losses for the year could be
curtailed to Rs.30.28 crores. A loss of Rs.21.17 crores was incurred
last year.
The Company has declared a closure during the month of June, July and
August 2013 due to labour unrest that followed the suggestion to defer
a part of the salary and allowances to a subsequent period after
restart of the plant, in view of difficulties during prolonged
shutdown.
After intervention by the Labour Department and detailed discussions
with the Union, the production could be restarted in October''13.
The closure was lifted on 23rd September,''13 and the power supply was
restored, which was also disconnected in the month of May''13 by TNEB.
Some of the Officers and Staff who have opted to retire early were also
taken back on fresh appointment to resume the production.
Production and Sales
The details of production and sales of the finished products for the
financial year are as under:
(In Tonnes)
Production Sales
Product 2013-14 2012-13 2013-14 2012-13
Soda Ash 9,775 54,700 9,685 53,253
(Light)
Soda Ash --- 2,010 6 2,008
(Dense)
Ammonium 7,672 50,226 4,797 51,052
Chloride
(Fertiliser)
Sodium --- 2,023 18 1,992
Bicarbonate
As already explained, only for 62 days the plants were in operation and
hence the capacity utilisation is very low.
Dividend
Your Directors were not able to recommend any dividend in view of the
continued losses incurred by the Company.
Market Scenario
Due to severe winter in Western Hemisphere, import of Soda Ash into the
country was less. Market prices improved due to improved international
prices and gap in supply/demand. Thus the local selling prices are
comparatively better for the last 2 months of operations in the year.
Ammonium Chloride (Fertiliser) price is also steady and is marketed
through Green Star Fertilisers Limited along with other Fertilisers
manufactured by them and SPIC. The market is expected to be good for
both Soda Ash and Ammonium Chloride (Fertiliser) in the next financial
year.
Future Outlook
Your Company markets its products in all the four southern states. The
market conditions have improved continuously in the last one year.
Opportunities and Threats
The conditions in Europe and reduced arrival of products from Eastern
Europe into India have provided good opportunities for your Company to
improve its operation and stabilise its market.
Risks and Concerns
TAC is dependent on SPIC for CO2. Their level of capacity utilisation
and proposal to change over to natural gas reforming will affect the
availability of CO2. Hence your Company is exploring the possibility of
an independent CO2 recovery facility. Similarly, the Company is also
solely dependent on the Ammonia importation terminal at Tuticorin Port.
Environment and Safety
The periodic audits as required for ISO 9001 have been carried out and
the recertification has been obtained.
Wind Mill
During the year 2.58 lakh units were generated from 5 Nos. of 250 KW
Wind Turbine Power Generators at Gudimangalam, Tirupur District, as
against 8.81 lakh units generated in the previous year.
Captive Salt Works
In view of the closure and disconnection of electricity, the production
was restricted to 13,802 MT. Operations have been recommenced from end
of March 2014 and will be stabilised soon.
BIFR
As already reported, ICICI Bank and IDBI Bank have assigned their
outstanding dues from your Company to Edelweiss ARC (EW). Your Company
are to avail the settlement plan from them. HDFC has also now assigned
their dues to EW and the Company will avail the settlement soon from
them. The Company has already sold the 5th floor of the Corporate
Office following BIFR guidelines in Feb.''14 and the proceeds will be
received in the next financial year as per BIFR guidelines and will
continue efforts to sell the remaining two floors.
Fixed Deposit
There was no outstanding deposit as at 31st March, 2014. However an
amount of Rs.0.14 lakhs remains unclaimed (representing two deposits).
Directors'' Responsibility Statement
In accordance with the requirements of Section 217(2AA) of the
Companies Act, 1956, the Directors of the Company hereby declare that:
a) in the preparation of the accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
b) the Directors had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at 31st March, 2014 and of the loss of the Company for
the year ended on that date;
c) the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
d) the Directors had prepared the annual accounts on a ''going
concern'' basis.
Industrial Relations
The Company employs around 211 employees on its roll, including
Engineers, Technicians and Trainees. The relationship with the union,
which went sour due to the prolonged shutdown between May and October
''13 and the Company declaring "Closure", has now improved
considerably. Now the relationship is cordial and the old dues to the
employees are being settled gradually.
Particulars of Employees
The Company has no Employees whose salary exceeds the limits prescribed
under section 217(2A) of the Companies Act, 1956. Hence information
required to be given under the said section read with the Companies
(Particulars of Employees) Rules, 1975 as amended has not been provided
in this report.
Conservation of Energy, Technology Absorption,
Foreign Exchange Earnings & Outgo
As required under Section 217(1)(e) of the Companies Act, 1956 read
with Rule 2 of the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988, information on conservation of
energy, technology absorption and foreign exchange earnings and outgo
is given in the annexure forming part of this report.
Directors
During the year there were no changes in the Directors of your Company:
In terms of Sections 149, 152 read with Schedule IV of the Companies
Act, 2013, the Board of Directors have reviewed the declaration made by
Independent Directors viz., Thiru B. Narendran, Dr. RM. Krishnan, Tvl.
S. Shankar and S. Asokan that they meet the criteria of independence as
provided in Section 149(6) of the Companies Act, 2013, and the Board is
of the opinion that they fulfill the conditions specified in the
Companies Act, 2013 and the rules made there under and is independent
of the management. In terms of section 149(10)
of the Companies Act, 2013, an Independent Director shall hold office
for a term up to five consecutive years on the Board of a company but
shall be eligible for reappointment on passing of a special resolution
by the company for a further period of upto five years. The proposal
for his appointment as Independent Director, not liable to retire by
rotation, for a period of five years has been placed before the
shareholders for approval.
Thiru G Ramachandran, who was earlier nominated as a VP/ Whole Time
Director, is redesignated as Managing Director from 1st November, 2013.
He is also permitted to extend consultancy services for setting up of a
Ammonia/Urea Plant. Consequently, he will not receive any salary from
TAC and only perks extended.
The two year term of Thiru G. Ramachandran, Managing Director was
completed on 11th December, 2013. The Board at its meeting held on 14th
November, 2013 has reappointed him for a further period of two years
subject to the approval of the shareholders.
Auditors
M/s CNGSN & Associates, Chartered Accountants, Chennai, the retiring
Auditors are eligible for reappointment.
With reference to the Statutory Auditor''s remark, vide Point No. 9 (a)
and 11 of the Annexure to the Auditor''s Report, that the deferred sales
tax and repayments to Financial Institutions and Banks have remained
defaulted, the Directors clarify that these will be suitably addressed
in the revised DRS being worked out.
Cost Audit
As per the Government of India''s directive, the Company''s Cost Records
in respect of Fertiliser - Ammonium Chloride and Chemical - Soda Ash
for the year ended 31st March, 2014 are being audited by the Cost
Auditor Thiru P R Tantri, who was appointed by the Board with the
approval of the Government of India.
Listing of Equity Shares
The Company''s equity shares are listed in the Bombay Stock Exchange
Limited.
Corporate Governance
As per Clause 49 of the Listing Agreement with the Stock Exchange, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a Certificate from the Company''s Auditors
confirming the compliance of the conditions of Corporate Governance is
attached to the report.
Acknowledgements
The Directors express their thanks for the assistance, co-operation and
support extended to the Company by the Government of India, the
Government of Tamil Nadu, SPIC, IDBI Bank, Tamilnad Mercantile Bank,
HDFC, State Bank of India, and other Commercial Banks, Edelweiss ARC
and all others who are associated with the Company. The Board wishes to
place on record its sincere appreciation for the services rendered by
the employees at all levels.
Disclaimer
Statements in the Management Discussion and Analysis describing the
Company''s objectives, estimates, projections, expectations may be
"forward-looking statements" within the meaning of applicable
securities laws and regulations. Actual results could differ materially
from those expressed or implied. Important factors that would make a
difference to the Company''s operations include economic conditions
affecting demand-supply and price conditions in the domestic and
overseas markets in which the Company operates, raw material
availability and its prices, changes in the Governmental regulations,
labour negotiations, tax laws and other statutes and economic
development within India.
For and on behalf of the Board of Directors
Chennai B. NARENDRAN G. RAMACHANDRAN
27th May, 2014 Director Managing Director
Mar 31, 2013
To The Members
The Directors present the 40th Annual Report together with the Audited
Accounts of the Company for the year ended 31 March 2013.
Financial Results
The following are the financial highlights :-
(Rupees in Crore)
DESCRIPTION 2012-13 2011-12
Sales Turnover
Net of Excise Duty
and Trade Discount) 155,91 216.12
Gross Loss after meeting all
expenses but before providing
depreciation and interest 9.12 0.54
Add: Interest 7.52 7.66
Cash Loss 16.64 8.20
Add: Depreciation for the year 4.53 4.59
Loss for the year 21.17 12.79
Accumulated Loss 148.93 127.76
The manufacturing activity was restricted to 228 days during the
financial year because of the water shortage and the consequent
non-availability of Carbon-di-oxide gas from SPIC. The Company incurred
loss of Rs .21.17 crores during the year as against the loss of Rs.
12.79 crores during the previous year.
The losses are primarily due to the lesser number of days of operation,
continuing high cost of Ammonia in the international market and the
steep increase in the cost of power. Though the selling prices
improved, for both Soda Ash and Ammonium Chloride (Fertiliser) compared
to last financial year, because of very low capacity utilisation of the
Plant at 49.34%, the overall results could not be improved.
Production and Sales
The details of production and sales of the finished products for the
financial year are as under:
(In Tonnes)
Product Production Sales
2012-13 2011-12 2012-131 2011-12
Soda Ash (Light) 54,700 77,603 53,253 78,500
Soda Ash 2,010 9,252 2,008 9,858
(Dense)
Ammonium 50,226 78,350 51,052 83,483
Chloride
(Fertiliser)
Sodium 2,023 3,882 1,992 3,893
Bicarbonate
As already explained, the lower production was due to the lesser number
of days of operation, which resulted in only 49.34% capacity
utilisation.
Dividend
Your Directors were not able to recommend any dividend in view of the
continued losses incurred by the Company.
Market Scenario
The market conditions marginally improved. However, the prices fell due
to lower international prices. Ammonium Chloride prices held steady.
The Company could also improve the domestic prices. In spite of
consistent request for supply of Ammonium Chloride, due to long periods
of non-production, the Company could not meet the entire demand. Soda
Ash market became sluggish and is expected to improve in the next
financial year.
Future Outlook
Since the southern markets are improving continuously, it is expected
that the entire production can be easily marketed in the southern
states.
Opportunities and Threats
The continuing slowing down and the global recession related large
scale imports into India from China and Europe will continue to depress
the selling price.
Risks and Concerns
The Company continues to be solely dependent on SPIC for the supply of
one of the vital raw materials Carbon-di-oxide gas. The proposal of
SPIC to change over to Natural Gas reforming also is likely to restrict
the availability of the gas. This would necessitate an independent
Carbon-di-oxide recovery facility. The Company is also solely dependent
on the Ammonia importation terminal at Tuticorin Port. Suitable spare
facilities may be needed in the course of time.
Environment and Safety
The periodic audits as required for ISO 9001 have been carried out and
the recertification has been obtained.
Wind Mill
During the year, 8.81 lakh units were generated from the Company''s five
250 KW Wind Turbine Power Generators at Gudimangalam, Coimbatore
District, as against 6.90 lakh units generated in the previous year.
Captive Salt Works
21,249 Tonnes of industrial grade raw salt was produced at the
Company''s salt works at Thoothukudi as against 21,290 Tonnes produced
during the previous year. The target of 30,000 Tonnes could not be
achieved due to unexpected rains and unfavourable conditions.
BIFR
ICICI Bank Limited & IDBI Bank Limited have assigned their outstanding
dues from your Company to Edelweiss ARC, who in turn have now offered a
settlement plan. To avail the settlement, BIFR has directed sale of the
Corporate Office space situated at "East Coast Centre", 534, Anna
Salai, Teynampet, Chennai 600 018, adopting the BIFR Guidelines. IDBI
Bank, the Operating Agency, has initiated action in this regard. It is
expected that substantial portion of the loan can be settled with the
proceeds of the sale of office space in the building. To facilitate
this, the Corporate/Principal Office has been shifted to SPIC House at
88, Mount Road, Guindy, Chennai 600 032, with effect from 15 April
2013.
Fixed Deposit
There was no outstanding deposit as at 31 March 2013. However an amount
of Rs.0.14 lakh remains unclaimed (representing two deposits).
Directors'' Responsibility Statement
In accordance with the requirements of Section 217(2AA) of the
Companies Act, 1956, the Directors of the Company hereby declare that:
a) in the preparation of the accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
b) the Directors had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at 31 March 2013 and of the loss of the Company for the
year ended on that date;
c) the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
d) the Directors had prepared the annual accounts on a ''going concern''
basis.
Industrial Relations
The Company employs around 280 employees on its roll, including
Engineers, Technicians and Trainees. The relationship with the Union
has remained normal.
Particulars of Employees
The Company has no Employees whose salary exceeds the limits prescribed
under section 217(2A) of the Companies Act, 1956. Hence information
required to be given under the said section read with the Companies
(Particulars of Employees) Rules, 1975 as amended has not been provided
in this report.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings & Outgo
As required under Section 217(1)(e) of the Companies Act, 1956 read
with Rule 2 of the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988, information on conservation of
energy, technology absorption and foreign exchange earnings and outgo
is given in the annexure forming part of this report.
Directors
During the year the following changes have taken place in the Board of
Directors of your Company:
IDBI Bank have assigned their portion of the loan to Edelweiss ARC and
hence rescinded their right to nominate a Director. Accordingly IDBI
Bank withdrew Tmt. Vatsala Krishnakumar with effect from 13 April 2013.
Thiru M Jayasankar resigned as a Director from the Board of the Company
with effect from 25 April 2013.
Thiru S Shankar and Thiru S Asokan were co-opted as Additional
Directors of the Company with effect from 27 May 2013.
The Board wishes to place on record the valuable services rendered by
Tmt. Vatsala Krishnakumar and Thiru M Jayasankar during their tenure as
Directors of the Company.
In terms of Section 256 of the Companies Act, 1956 Thiru B Narendran
retires by rotation and offers himself for re-election.
Auditors
M/s CNGSN & Associates, Chartered Accountants, Chennai, the retiring
Auditors are eligible for reappointment.
With reference to the Statutory Auditor''s remark, vide Point No. 9 (a)
and 11 of the Annexure to the Auditor''s Report, that the deferred sales
tax and repayments to Financial Institutions and Banks have remained
defaulted, the Directors clarify that these will be suitably addressed
in the revised DRS being worked out.
Cost Audit
As per the Government of India''s directive, the Company''s Cost Records
in respect of Fertiliser -Ammonium Chloride and Chemical - Soda Ash for
the year ended 31 st March, 2013 are being audited by the Cost Auditor
Thiru P R Tantri, who was appointed by the Board with the approval of
the Government of India.
Listing of Equity Shares
The Company''s equity shares are listed in the Bombay Stock Exchange
Limited.
Corporate Governance
As per Clause 49 of the Listing Agreement with the Stock Exchange, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a Certificate from the Company''s Auditors
confirming the compliance of the conditions of Corporate Governance is
attached to the report.
Acknowledgements
The Directors express their thanks for the assistance, co-operation and
support extended to the Company by the Government of India, the
Government of Tamil Nadu, SPIC, IDBI Bank, ICICI Bank, Tamilnad
Mercantile Bank, HDFC, State Bank of India, and other Commercial Banks,
Edelweiss ARC and all others who are associated with the Company. The
Board wishes to place on record its sincere appreciation for the
services rendered by the employees at all levels.
Disclaimer
Statements in the Management Discussion and Analysis describing the
Company''s objectives, estimates, projections, expectations may be
"forward-looking statements" within the meaning of applicable
securities laws and regulations. Actual results could differ materially
from those expressed or implied. Important factors that would make a
difference to the Company''s operations include economic conditions
affecting demand-supply and price conditions in the domestic and
overseas markets in which the Company operates, raw material
availability and its prices, changes in the Governmental regulations,
labour negotiations, tax laws and other statutes and economic
development within India.
For and on behalf of the Board
of Directors
Chennai B. NARENDRAN G. RAMACHANDRAN
27 May 2013 Director VP/Whole Time Director
Mar 31, 2012
The Directors present the 39th Annual Report together with the Audited
Accounts of the Company for the year ended March 31, 2012.
The Directors are pleased to inform the Members that the Company's
plant at Thoothukudi, after recommencement of manufacturing operations
in the third week of October, 2010 (last financial year), has
continuously carried on the manufacturing operations throughout the
year, barring few occasions, upto March 8, 2012 when the plant was
shutdown for annual maintenance. After annual maintenance the plant was
restarted on April 11, 2012 and is operating close to the rated
capacities.
Financial Results
The following are the financial highlights:-
(Rupees in Crores)
DESCRIPTION 2011-12 2010-11
Sales Turnover (Net of Excise 216.12 47.60
Duty and Trade Discount)
Gross Loss after meeting
all expenses but before
providing depreciation
and interest 0.54 10.62
Add: Interest 7.66 7.02
Add: Provision for Tax - Ã Ã
Fringe Benefit Tax
Cash Loss 8.20 17.64
Add: Depreciation for the
year 4.59 4.72
Loss for the year 12.79 22.36
Accumulated Loss 127.76 114.97
The plants operated almost throughout the year and the sales turnover
rose impressively to record the highest turnover ever achieved by your
Company. However the cash losses and total loss for the year continued
but at reduced levels. The losses have come down from Rs.22.36 crores
to Rs.12.79 crores. The losses were mainly due to sudden abnormal
increase in the price of Ammonia in the international market. The
Company imports the required Ammonia, predominantly from Middle East.
The selling price of Ammonium Chloride Fertiliser manufactured by the
Company using this Ammonia did not go up in unison with the price of
Ammonia which resulted in a deficit, which coupled with the low selling
price of Soda Ash that prevailed in the first six months of the year
resulted in the loss. However, the Plant had to be shutdown from March
8, 2012 to April 11, 2012, in tandem with SPIC Fertiliser Plant for
carrying out Annual Maintenance Work. Thus the effect of the
improvement in the market conditions could not be utilised in full.
Production and Sales
The details of production and sales of the finished products for the
financial year are as under
(in Tonnes)
Production Sales
Product 2011-12 2010-11 2011-12 2010-11
Soda Ash 77,603 26,815 78,500 22,929
(Light)
Soda Ash 9,252 790 9,858 181
(Dense)
Ammonium 78,350 23,105 83,483 17,145
Chloride
Fertiliser
Sodium 3,882 225 3,893 214
Bicarbonate
The Directors are happy to inform that your Company has further
improved its export market and exported 43,992 Tonnes of Ammonium
Chloride Fertiliser to Malaysia and realised the foreign currency
amounting to Rs.3,856 lakhs during the year.
Dividend
Your Directors were not able to recommend any dividend in view of the
continued losses incurred by the Company.
Market Scenario
The market conditions were sluggish initially, especially in the first
six months with low international prices of Soda Ash and low domestic
price of Ammonium Chloride Fertiliser. However, the situation improved
during the second half and the prices of Soda Ash improved adequately
to cover the operating cost. The company also started exporting
Ammonium Chloride Fertiliser at a better price compared to local
selling prices. During the year your Company exported 43,992 MT of
Ammonium Chloride Fertiliser. Scope exists for further improvement in
the market conditions and also market share for the products produced
by the Company.
Future Outlook
New detergent and glass industries, where the soda ash is used
predominantly, are being set up in the southern markets.
The country is also importing significant quantities of soda ash and
hence marketing the product at the international price is not difficult
and will help to maintain the sales.
Opportunities and Threats
While the expanding down stream industries have created opportunities
for the Company to stabilise the market, the global recession and large
scale imports from China and Europe can depress the selling price and
also reduce the market share. The Anti Dumping Duty on Soda Ash is yet
to be implemented.
Risks and Concerns
The company is solely depending on SPIC for one of the vital raw
material, Carbon-di-oxide gas. Hence, the supply on continuous basis
from them is essential to maintain continuous production of the
Company. The pro posal of S PI C to change over to Natural Gas
reforming within the next 2-3 years can affect the supply of the above
gas from them and the Company has to develop its own source in due
course for maintaining the production independently. Thoothukudi Port
offers facilities for the import of Ammonia and it is not a great
concern with multiple suppliers internationally.
Environment and Safety
The periodic audits as required for ISO 9001 have been carried out and
the recertification has been obtained.
Wind Mill
During the year, 6.90 lakh units were generated from 5 Nos. of 250 KW
Wind Turbine Power Generators at Gudimangalam, Coimbatore District, as
against 5.83 lakh units generated in the previous year.
Captive Salt Works
21,290 Tonnes of industrial grade raw salt was produced at the
Company's salt works at Thoothukudi as against 15,175 Tonnes produced
during the previous year.
BIFR
In view of no appreciable improvement in the working results of the
Company, especially when Ammonia prices ruled very high during the
year, the Company could not make much progress in the discussions with
the Financial Institutions for restructuring the debt. The Financial
Institutions have indicated that they preferred a One Time Settlement
(OTS) of the term loan, to restructuring. BIFR has directed the Company
and the institutions to arrive at a solution soon. DRS can be submitted
to BIFR through the Operating Agency M/s. IDBI Bank Limited, after the
settlement has been arrived at.
Fixed Deposit
There was no outstanding deposit as at March 31, 2012. However an
amount of Rs.0.14 lakhs remains unclaimed (representing two deposits).
Directors' Responsibility Statement
In accordance with the requirements of Section 217(2AA) of the
Companies Act, 1956, the Directors of the Company hereby declare that:
a) in the preparation of the accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
b) the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2012 and of the loss of the Company for the
year ended on that date;
c) the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
d) the Directors had prepared the annual accounts on a 'going concern'
basis.
Industrial Relations
As on March 31, 2012, your company had around 362 employees on its roll
at different locations, including Engineer, Technicians and Trainees.
Wherever necessary, training is imparted at all levels. The
relationship with the union has remained normal.
Particulars of Employees
The Company has no Employees whose salary exceeds the limits prescribed
under section 217(2A) of the Companies Act, 1956. Hence information
required to be given under the said section read with the Companies
(Particulars of Employees) Rules, 1975 as amended has not been provided
in this report.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings & Outgo
As required under Section 217(1)(e) of the Companies Act, 1956 read
with Rule 2 of the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988, information on conservation of
energy, technology absorption and foreign exchange earnings and outgo
is given in the annexure forming part of this report.
Directors
During the year the following changes have taken place in the Board of
Directors of your Company:
Thiru G. Ramachandran was co-opted as an Additional Director and
designated as Vice President / Whole Time Director with effect from
December 12, 2011.
Thiru S. Chandramohan resigned as the Managing Director of the Company
with effect from December 31, 2011.
Thiru B. Narendran and Dr. RM. Krishnan were co-opted as Additional
Directors of the Company with effect from January 18, 2012.
Dr. A. C. Muthiah, Thiru Ashwin C Muthiah and Thiru R. Soundararajan
have resigned from the Board of Directors of the Company from January
18, 2012. Thiru B. Narendran has been nominated as the Chairman of the
Audit Committee in place of Thiru R. Soundararajan.
The Board wishes to place on record the valuable services rendered by
Dr. A. C. Muthiah, Tvl. Ashwin C Muthiah, R. Soundararajan and S.
Chandramohan during their tenure as Chairman, Directors and Managing
Director of the Company, respectively.
In terms of Section 256 of the Companies Act, 1956 Thiru M. Jayasankar
retires by rotation and offers himself for re- election.
Auditors
M/s CNGSN & Associates, Chartered Accountants, Chennai, the retiring
Auditors are eligible for reappointment.
With reference to the Statutory Auditor's remark, vide Point No.9(a)
and 11 of the Annexure to the Auditor's Report, that the deferred sales
tax and repayments to Financial Institutions and Banks have remained
defaulted, the Directors clarify that these will be suitably addressed
vide the revised DRS being worked out.
Cost Audit
As per the Government of India's directive, the Company's Cost Records
in respect of Fertiliser à Ammonium Chloride and Chemical - Soda Ash
for the year ended March 31, 2012 are being audited by the Cost
Auditor, Thiru P R Tantri, who was appointed by the Board with the
approval of the Government of India.
Listing of Equity Shares
The Company's equity shares are listed in the Bombay Stock Exchange
Limited.
Corporate Governance
As per Clause 49 of the Listing Agreement with the Stock Exchange, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a Certificate from the Company's Auditors
confirming the compliance of the conditions of Corporate Governance is
attached to the report.
Acknowledgements
The Directors express their thanks for the assistance, co- operation
and support extended to the Company by the Government of India, the
Government of Tamil Nadu, SPIC, IDBI Bank, ICICI Bank, Tamilnad
Mercantile Bank, HDFC, State Bank of India and other Commercial Banks
and all others who are associated with the Company. The Board wishes to
place on record its sincere appreciation for the services rendered by
the employees at all levels.
Disclaimer
Statements in the Management Discussion and Analysis describing the
Company's objectives, estimates, projections, expectations may be
"forward-looking statements" within the meaning of applicable
securities laws and regulations. Actual results could differ
materially from those expressed or implied. Important factors that
would make a difference to the Company's operations include economic
conditions affecting demand-supply and price conditions in the domestic
and overseas markets in which the Company operates, raw material
availability and its prices, changes in the Governmental regulations,
labour negotiations, tax laws and other statutes and economic
development within India.
For and on behalf of the Board of Directors
Chennai M. JAYASANKAR G. RAMACHANDRAN
May 25, 2012 Director VP/Whole Time Director
Mar 31, 2011
The Members
The Directors present the 38th Annual Report together with the Audited
Accounts of the Company for the year ended March 31, 2011.
The Company is pleased to inform the Members that the Company's plant
at Thoothukudi had recommenced its manufacturing operations from the
third week of October, '10 consequent to the availability of
Carbon-di-oxide (CO2) from SPIC's Ammonia Plant which was restarted
during the first week of October '10. The Company's plant after the
initial teething trouble has stabilised its operations from March '11.
Financial Results
The following are the financial highlights:-
(Rupees in Crores)
DESCRIPTION 2010-11 2009-10
Sales Turnover (Net of Excise 47.60 7.27
Duty and Trade Discount)
Gross Loss after meeting all
expenses but before providing
depreciation and interest 10.62 14.91
Add: Interest 7.02 6.35
Add: Provision for Tax - 001
Fringe Benefit Tax
Cash Loss 17.64 21.27
Add: Depreciation for the 4.72 4.81
year
Loss for the year 22.36 26.08
Net Loss (Balance brought
forward from previous year 92.61 66.53
after adjustment)
Accumulated Loss 114.97 92.61
For the year ended March 31, 2011, the Company has incurred a net loss
of Rs.22.36 crores due to shut down of the plant from April '10 to
October '10 due to non-availability of CO2. Arising out of the shut
down, the actual production during the Financial Year was only for 146
days.
Production and Sales
The details of production and sales of the finished products during the
year ended March, 31 2011 are given below;
(in Tonnes)
Product Production Sales
Soda Ash (Light) 26,815 22,929
Soda Ash (Dense) 790 181
Ammonium Chloride Fertiliser 23,105 17,145
Sodium Bicarbonate 225 214
Note: Since there was no production and sales for the year ended
31.3.10, comparative figures were not shown in the above statement.
The Company had received an Export Order from Malaysia for 15,600
Tonnes of Ammonium Chloride Fertiliser, out of which it had completed
despatch of 9,490 Tonnes. The balance quantity of 6,110 Tonnes will be
despatched by July 15, 2011. The export order is likely to be continued
in the months to come.
Wind Mill
During the year, 5.83 lakh units were generated from 5 Nos. of 250 KW
Wind Operated Electricity Generators at Gudimangalam, Coimbatore
District, as against 6.23 lakh units generated in the previous year.
Captive Salt Works
During the year salt production was 15,175 Tonnes at the Company's salt
works as against 14,106 Tonnes produced during the previous year.
Trading
Trading of Phospo Gypsum was stopped due to thin margin. However the
Company had traded a marginal quantity of 2,691 Tonnes compared to
40,845 Tonnes traded during the previous year.
BIFR
The restructuring proposal of the Company with the term loan lenders
and working capital bankers is likely to be finalised during June '11
by the Empowered Group of the Corporate Debt Restructuring (CDR) Cell
at Mumbai. Thereafter the Draft Rehabilitation Scheme (DRS) of the
Company would be submitted with the approval of all the secured lenders
to BIFR through the Operating Agency viz., IDBI Bank Limited for
approval by BIFR.
Fixed Deposit
There was no outstanding deposit as at March 31, 2011. However an
amount of Rs.0.29 lakh remains unclaimed (representing three deposits).
Directors' Responsibility Statement
In accordance with the requirements of Section 217(2AA) of the
Companies Act, 1956, the Directors of the Company hereby declare that:
a. in the preparation of the accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
b. the Directors had selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as at March 31, 2011 and of the loss of the Company for
the year ended on that date;
c. the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
d. the Directors had prepared the annual accounts on a 'going concern'
basis.
Industrial Relations
Industrial relations continued to remain cordial.
Particulars of Employees
The Company has no Employees whose salary exceeds the limits prescribed
under section 217(2A) of the Companies Act, 1956. Hence information
required to be given under the said section read with the Companies
(Particulars of Employees) Rules, 1975 as amended has not been provided
in this report.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings & Outgo
As required under Section 217(1)(e) of the Companies Act, 1956 read
with Rule 2 of the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988, information on conservation of
energy, technology absorption and foreign exchange earnings and outgo
is given in the annexure forming part of this report.
Directors
There was no change in the Directors of the Company during the year. In
terms of Section 256 of the Companies Act, 1956, Thiru R Soundararajan,
Director, retires by rotation and being eligible, offers himself for
re-election.
Auditors
M/s CNGSN & Associates, Chartered Accountants, Chennai, the retiring
Auditors are eligible for reappointment.
Statutory Auditors in the Annexure to the Auditors Report (point Nos.
9. a. and 11) had mentioned the non remittance of Deferred Sales Tax of
Rs.243.72 lakhs and default in repayments to Financial Institution and
Banks amounting to Rs.4,354.43 lakhs. In this connection the Directors
wish to inform that the above dues had been restructured and addressed
in the Draft Rehabilitation Scheme submitted to the Operating Agency
viz, IDBI Bank Limited which are subject to the approval of the lenders
and BIFR.
Cost Audit
As per the Government of India's directive, the Company's Cost Records
in respect of Fertiliser à Ammonium Chloride and Chemical - Soda Ash
for the year ended March 31, 2011 are being audited by the Cost Auditor
Thiru P R Tantri, who was appointed by the Board with the approval of
the Government of India.
Listing of Equity Shares
The Company's equity shares are listed in the Bombay Stock Exchange
Limited.
Corporate Governance
As per Clause 49 of the Listing Agreement with the Stock Exchange, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a Certificate from the Company's Auditors
confirming the compliance of the conditions of Corporate Governance is
attached to the report.
Acknowledgements
The Directors express their thanks for the assistance, co- operation
and support extended to the Company by the Government of India, the
Government of Tamil Nadu, SPIC, IDBI Bank, ICICI Bank, Tamilnad
Mercantile Bank, HDFC, State Bank of India and other Commercial Banks
and all others who are associated with the Company. The Board wishes to
place on record its sincere appreciation for the services rendered by
the employees at all levels.
For and on behalf of the
Board of Directors
A.C. MUTHIAH
Chairman
Chennai
June 16, 2011
Mar 31, 2010
The Directors hereby present the 37th Annual Report together with the
Audited Accounts of the Company for the year ended March 31, 2010.
Companys Plants continued to be under shut down for the last three
years, due to non-availability of Carbon-di-oxide(Co2) from SPIC, owing
to shut down of SPICs Ammonia Plant. Hence, there was no
manufacturing operation during the year.
SPIC is expected to restart its Ammonia Plant in August 2010, which
would enable the supply of Co2 to the Company so that the manufacturing
operations of the Company could commence thereafter. In order to
facilitate the smooth restart of the Companys Plant, refurbishment of
Companys Plant and Machinery has already started and the work is
expected to be completed in August 2010.
The Board for Industrial and Financial Reconstruction (BIFR) has
declared the Company as a Sick Industrial Undertaking effective from
July 14, 2009 and appointed IDBI Bank Limited as the Operating Agency
(OA) for finalising a suitable rehabilitation package for revival of
the Company. The Company is in discussion with its lenders and is in
the process of filing a fully tied up Draft Rehabilitation Scheme to
BIFR by end of July 2010.
Financial Results
The following are the financial highlights:-
(Rupees in Crores)
DESCRIPTION 2009-10 2007-09
(12 months) (18 months)
Sales Turnover (Net of Excise 7.27 14.43
Duty and Trade Discount)
Gross Loss after meeting all
expenses but before
providing depreciation
and interest 14.91 16.29
Add: Interest 6.35 8.76
Add: Provision for Tax -
Fringe Benefit Tax 0.01 0.08
Cash Loss 21.27 25.13
Add: Depreciation for the
4.81 7.37
year
Loss for the year 26.08 32.50
Net Loss brought forward
from previous year after 66.53 34.03
adjustment
Accumulated Loss 92.61 66.53
During the year ended March 31, 2010, your Company has incurred a net
loss of Rs.26.08 crores due to continuous shut down of the Plant for
the entire year due to non-availability ofC02.
Wind Mill
During the year, 6.23 lakh units were generated from 5 Nos. of 250 KW
Wind Operated Electricity Generators at Gudimangalam, Coimbatore
District, as against 5.91 lakh units generated in the last 18 months
period.
Captive Salt Works
During the year salt production was 14,106 MT at the Companys salt
works as against 13,680 MT produced during the previous 18 months
period.
Trading
During the year the Company has commenced trading of Phospo Gypsum,
used for manufacturing cement, and sold 40,845 Tonnes.
Fixed Deposit
There was no outstanding deposit as at March 31, 2010. However an
amount of Rs.0.39 lakh remains unclaimed (representing four deposits).
Directors Responsibility Statement
In accordance with the requirements of Section 217(2AA) of the
Companies Act, 1956, the Directors of the Company hereby declare that:
a. in the preparation of the accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
b. the Directors had selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as at March 31, 2010 and of the loss of the Company for
the year ended on that date;
c. the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
d. the Directors had prepared the annual accounts on a going concern
basis.
Industrial Relations
Industrial relations continued to remain cordial.
Particulars of Employees
A statement giving particulars of employees as required under Section
217(2A) of the Companies Act, 1956 read with the Companies (Particulars
of Employees) Rules, 1975 forming part of this Report is annexed
hereto.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings & Outgo
As required under Section 217(1)(e) of the Companies Act, 1956 read
with Rule 2 of the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988, information on conservation of
energy, technology absorption and foreign exchange earnings and outgo
is given in the annexure forming part of this report.
Directors
There was no change in the Directors of the Company during the year. In
terms of Section 256 of the Companies Act, 1956, Thiru Ashwin C
Muthiah, Director, retires by rotation and being eligible, offers
himself for re-election.
Auditors
M/s. CNGSN & Associates, Chartered Accountants, Chennai the retiring
Auditors, are eligible for reappointment.
With regard to the observation of the Auditors, the Board of Directors
are taking all possible steps for recommencement of manufacturing
operations by August/September 2010.
Cost Audit
Since there was no manufacturing activity during the year ended March
31, 2010, it is proposed to obtain exemption, from the Ministry of
Corporate Affairs, Government of India, from conducting the Cost Audit
for Fertiliser - Ammonium Chloride and Chemical - Soda Ash.
Listing of Equity Shares
The Companys equity shares are listed in the Bombay Stock Exchange.
Corporate Governance
As per Clause 49 of the Listing Agreement with the Stock Exchange, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a Certificate from the Companys Auditors
confirming the compliance of the conditions of Corporate Governance is
attached to the report.
Acknowledgements
The Directors express their thanks for the assistance, co- operation
and support extended to the Company by the Government of India, the
Government of Tamil Nadu, SPIC, IDBI Bank, ICICI Bank, Tamilnad
Mercantile Bank, HDFC, State Bank of India and other Commercial Banks
and all others who are associated with the Company. The Board wishes to
place on record its sincere appreciation for the services rendered by
the employees at all levels.
Chennai
May 3, 2010
For and on behalf of the
Board of Directors
AC.MUTHIAH
Chairman
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