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Directors Report of VHCL Industries Ltd.

Mar 31, 2014

Dear members,

The Directors have pleasure in presenting their 23rd Annual Report on the business and operations of the Company for the year ended on 31st March, 2014.

Financial Results: (Rs. In Lacs)

Particulars For the year ended For the year ended 31st March, 2014 31st March, 2013

Sales 49820.81 48017.21

Other Income 85.95 121.20

Total Revenue 49906.77 4813.41

Profit before Depreciation, 3217.81 2235.45 Finance Cost, Exceptional Items and Taxation

Less : Depreciation and 126.74 148.09 amortization

Profit before Finance Cost, 3091.07 2087.36 Exceptional Items and Taxation

Less : Finance Cost 1254.18 816.65

Profit before Exceptional 1836.89 1270.70 Items and Taxation

Less : Exceptional Items 1776.82 291.43

Profit (Loss) before Taxation 60.07 979.27

Less : Provision for Tax - 42.00 317.52 Current Tax (Including MAT Credit entitlementand previous year tax)

Less: Provision for Tax - Deferred Tax 15.23 (32.34)

Profit for the year 2.84 694.09

Add: Balance of Profit for earlier years 3909.84 1605.64

Add: Shares Premium - 1696.00

Profit available for appropriation 3912.68 3995.73

Less : Proposed Dividend - 73.90

Less : Income tax on Proposed Dividend - 11.99

Balance Carried Forward 3912.68 3909.84



Financial Performance :

Despite the bleak economic scenario and tight money market, the results for the financial year ended 31st March, 2014 were better than the previous financial year. The Sales of the Company increased to Rs. 49,820.81 Lacs from Rs. 48017.21Lacs in the previous year, at a growth rate of 3.76%. The Profit before Depreciation, Finance cost, exceptional item and Tax increased from Rs.2235.45Lacs in the preceding financial year to Rs. 3217.81Lacs in the year under Report.

The profit before tax and exceptional items increased from Rs.1270.70 Lacs for the financial year ended 31st March, 2013 to Rs.1836.89 Lacs for the current financial year. However, due to huge forex losses, the net profit came down from Rs.694.09 Lacs to Rs.2.84 Lacs in the corresponding period.

Future Outlook :

The Board of Directors of the Company at its meeting held on Monday, March 31, 2014, inter-alia decided to de-merge the Metal Division of the Company into a separate entity in order to invite industry specific investment as well as unlock shareholder value.

The metal division of the company has two on-going projects:

(1) 36,000 MTPA Aluminum Alloy Plant.

(2) 18,000 MTPA EOU project for production of Non-Ferrous alloys.

The Proposal outlined to the board was that the second phase expansion would require an investment to the tune of Rs. 400 Cr. in fixed assets and working capital which may not be possible for the company to generate from its existing shareholder base and internal accruals. The Proposal suggested that the Company may seek FDI for the project. Initial discussions with a few players indicate that the investment may come in only if the metal division is a separate entity. To achieve this, the metal division would have to be demerged from the plastic division through Court to retain the licenses obtained till date intact. The demerger would have the added advantage of unlocking shareholder value of the existing stakeholders as well as allow the metal division to grow faster.

The Board was also presented with a proposal to merge the plastics business of UIC Corporation Pvt. Ltd. (hereinafter referred as ''UIC''), an Associate Company, with itself. UIC is engaged in similar business of reprocessing/recycling plastic materials and has achieved sales of Rs. 415 Cr. in the current financial year. The merger will provide the Company with operational synergy as well as a reduction in operational cost apart from adding to the revenue and profitability of the Company.

The Board was of the opinion that in order to enhance the Company''s focus towards its core business of plastics recycling and increase its market share, the Company should proceed with the merger as this would be in line with the overall vision of the company to achieve greater value for all its stake holders.

Dividend :

Due to drastic reduction in the profitability of the Company, your Directors have decided not to recommend any dividend for the financial year ended 31st March, 2014.

Directors and Key Managerial Personnel :

Mr. Nimesh Joshi, Director of the Company has resigned from the Board with effect from 03rd December, 2013 The Board placed on record its appreciation for valuable service rendered by him to the Company during his tenure as Director of the Company.

Mr. Pradeep Soni, Company Secretary and Compliance officer has resigned from the Company with effect from 14th February, 2014. The Board placed on record its appreciation for valuable service rendered by him to the Company during his tenure as Director of the Company.

Director''s Responsibility Statement :

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors confirm as under:

a) that in the preparation of annual accounts, the applicable Accounting Standards have been followed and there has been no material departures;

b) that the Directors have selected such Accounting policies and applied them consistently and 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 or loss of the Company for that period;

c) that the Directors have 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) that the Directors have prepared the Annual Accounts on a going concern basis.

Management Discussion and Analysis Report :

In Compliance with Clause 49 of the Listing Agreement with the Stock Exchanges, a detailed Management Discussion and Analysis Report form part of the annual report.

Corporate Governance :

In Compliance with Clause 49 of the Listing Agreement with the Stock Exchange, a detailed Corporate Governance Report forms part of the annual report.

The requisite certificate from the Practicing Company Secretary, confirming compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of annual report.

Auditor and Auditor''s Report :

During the year under review M/s. Sarda Soni Associates, Chartered Accountants tendered their resignation due to preoccupation and M/s. Rakesh R. Agrawal & Associates, Chartered Accountants was appointed in the place of the retiring auditor to held office upto the conclusion of 23rd Annual General Meeting.

The Audit Committee recommends the re-appointment of M/s. Rakesh R. Agrawal & Associates, Chartered Accountants, as Statutory Auditors of the Company and accordingly board of directors proposed the reappointment of said auditors.

As required under the provisions of Sections 139(1) of the Companies Act, 2013, the Company has obtained a written Certificate from the above Auditors proposed to be re-appointed to the effect that their re-appointment, if made, would be in conformity with the limits specified in the said Section.

The observations of the Auditors in their report, read with the accounts are self-explanatory and therefore don''t require further explanation.

Audit Committee :

The Company constituted an Audit Committee under Section 177 of the Companies Act, 2013 and Clause 49 of the Listing Agreement and the composition of it is given in the Report on Corporate Governance.

Shareholders/Investor Grievance Committee :

The company constituted a Shareholders/Investors Grievance Committee pursuant to Clause 49 of the Listing Agreement and the composition of it is as given in the Report on Corporate Governance.

Listing :

The shares of the Company are listed at BSE Limited and company is consistent in payment of listing fees as prescribed by the Exchange. As on 31st March, 2014, out of total share capital comprising of 36951970 shares, 35835633 shares i.e. 96.98% of the total capital have been Dematerialised by investors.

Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo :

Information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are set out in Annexure "A" to this report.

Public Deposits :

The Company has not accepted/invited any Public Deposits during the year under report.

Particulars of Employees :

The Company has no employee in the category specified under Section 217(2A) of the Companies Act, 1956.

Acknowledgements :

Your Board of Directors is pleased to place on record their appreciation for the cooperation and support extended by all India financial institutions, Banks, Central and State Government authorities, Customers, Vendors and Members during the year under review.

Your Directors also wish to place on record its appreciation for the valuable services rendered by the executives, staff and workers of the Company.



For and on behalf of the Board

Sd/- PANKAJ VALIA Chairman and Managing Director

Place : Mumbai Date : 30th May, 2014


Mar 31, 2012

Dear Members'

The Directors have pleasure in presenting their 21st Annual Report on the business and operations of the Company for the year ended 31st March, 2012.

1. FINANCIAL RESULTS:

(Rs. In Lacs)

Particulars 31st March, 31st March, 2012 2011

Sales 22816.59 6.98

Other Income 73.56 0.03

Profit (Loss) before Depreciation 120.732 (2.16)

Less : Depreciation 165.44 0.00

Net Profit/(Loss) before Tax 741.95 (2.16)

Less : Provision for Tax (MAT) 57.44 0.00

Less: Deferred Tax Liability 0.00 0.00

Profit/(Loss) after Tax 694.52 (2.16)

Appropriations

Less: Proposed Dividend (10%) 63.30 0 00

Tax on proposed dividend 10.27 0.00

Amount Available for appropriation 620.95 (2.16)

Provision For Income of Tax 0.00 0.00 earlier written back

Balance Transferred to Profit & 620.95 (2.16) Loss A/c

2. DIVIDEND:

The Board of Directors of the Company recommends Dividend at the rate of 0.20 paisa per share (10%) on 31651970 Equity Shares of Rs. 21- per share amounting to Rs. 6330394/- to the shareholders, whose name appears in the Register of Members of the Company as on the record date i.e. 24th September. 2012.

3. SANCTION OF THE COMPOSITE SCHEME OF ARRANGEMENT AND AMALGAMATION

The Hon'ble Bombay High Court by Order dated 13th April 2012 has sanctioned the Composite Scheme of Arrangement and Amalgamation of VHCL Industries Ltd with the Jhaveri Weldflux Limited w.e.f from 1st April 2011. In terms of the said Sanctioned Scheme the name of the Jhaveri Weldflux Limited has also changed to VHCL Industries Ltd. Note No 25 of the Notes forming part of the Financial Statements give the salient features of the said Sanctioned Scheme. Since the figures of the previous year of both Companies cannot be merged for the purpose of comparison due to the effect of the Amalgamation of the two Companies given in the Financial Statements for the year ended 31.03.2012, the previous year figures for the year ended 31.03.2011 have been given on standalone basis of Jhaveri Weldflux Limited only.

4. DIRECTORS:

Shri Pankaj H. valia and Harshadrai Bosmia were appointed as Directors of the Company with effect from 17th November, 2011.

Mr. Gaurav A. Sheth and Mr. Pankaj P. Jhaveri have resigned from the Board with effect from 2nd June. 2011. The Board places on record their appreciation for valuable service rendered by them to the Company during their tenure as Director of the Company.

5. AUDITORS :

Mr. Hiteshkumar P. Shah, Chartered Accountant has expressed their unwillingness to be re- appointed as Statutory Auditors of the Company for the year 2012-13 in the forth coming Annual General Meeting, The Company has received consent letter from Sarda Soni Associates as chartered Accountant for their appointment as Statutory Auditor of the Company provided their appointment is approved by the Shareholders at the forth coming Annual General Meeting. M/s Sarda Soni Associates have also confirmed that their appointment, if made, will be with in the limits prescribe u/s 224 of the Companies Act, 1956

AUDITOR'S REPORT :

The observations made in the Auditor's Report as regards accounting treatment for retirement benefits on cash basis, the Directors state that the Company has been consistently following cash basis for payment of retirement benefits to its employees.

AUDIT COMMITTEE :

The composition of Audit Committee is as given in the Report on Corporate Governance.

SHAREHOLDERS'/INVESTOR GRIEVANCE COMMITTEE :

The composition of Shareholders'/Investor Grievance Committee is as given in the Report on Corporate Governance.

REPORT ON CORPORATE GOVERNANCE :

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a Management Discussion and Analysis Report and a Corporate Governance Report are made as a part of this Annual Report.

A Certificate from the M/s. Hitesh kumar P. Shah. Chartered Accountants. regarding Compliance of the conditions of Corporate Governance as stipulated by Clause 49 of the Listing Agreement is attached to this report.

DIRECTOR' S RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act. 1956, the Directors confirm that:

a) In the presentation of the Annual Accounts, the applicable Accounting Standards has been followed and no material departures except to the extent disclosed have been made from the same.

b) the Directors had selected such Accounting policies and applied them consistently and 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 or 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 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.

STATEMENTS OF PARTICULARS UNDER COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988

Information in accordance with the provisions of Section 217(1) (e) of the Act read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo is given in Annexure "A".

PUBLIC DEPOSITS

The Company has not accepted any Public Deposits during the year under report.

INSURANCE:

The properties, stock, assets of your Company are adequately insured.

PARTICULARS OF EMPLOYEES :

The Company has no employee in the category specified under Section 217(2A) of the Companies Act, 1956.

For and on behalf of the Board

Sd/- Pankaj H. Valia (CHAIRMAN)

PLACE : Mumbai DATE : 24th August, 2012


Mar 31, 2011

The Directors are pleased to present before the shareholders the 20th ANNUAL REPORT together with the Audited Accounts along-with the report of the Auditors for the year ended 31st March, 2011.

FINANCIAL RESULTS (Rs. In Lacs)

Particulars March 2011 March 2010

Turnover 7.01 2.08

Loss before Interest and depreciation (2.16) (1.21)

Interest - -

Loss after interest but before depreciation (2.16) (1.21)

Depreciation - -

Loss after interest and Depreciation (2.16) (1.21)

Loss before Tax (2.16) (1.21)

Taxation - -

Loss after Tax (2.16) (1.21)

Balance Carried to balance sheet (2.16) (1.21)

PERFORMANCE OF THE COMPANY

The company has cleared off all its secured liabilities except deferred sales tax liabilities amounting to Rs.9,80,425/-. The total debtors of the company are Rs. 28,94,435 out of which nearly 97.73% amounting to Rs.28,28,727 are more than six months old out of which court cases for 94.30% Rs. 26,67,613 have been filed. Presently, the Company is not carrying out any manufacturing activities and has concentrated on small amount of trading and commission business. The Company is also exploring the possibilities of tie-ups with some healthy and profitable units for the future growth and expansion of the Company.

The trading of the company's shares has been suspended on the stock exchanges due to non compliance of the listing agreement. However, after complying with the necessary formalities the Company's shares got re-listed on BSE on 30th May, 2011. Your Company has paid the annual listing fees to the BSE.

DIVIDEND

In view of the losses being suffered by the company and the capital & reserves of the company being wiped out by nearly 93.37% the directors are not in a position to declare any dividends and so dividend is not recommend for the year.

DIRECTORS

Mr. Atul A. Mehta, Mr. Nimesh S. Joshi, Mr. Mandar S. Palav and Mr. Mitesh H. Dani have been inducted on the Board of Directors with effect from 18th November 2010. Mr. Ashish S. Pandare has been inducted on the Board of Directors with effect from 2nd June 2011.

The Board has approved the appointment of the above directors and now to regularize their appointment the Board has placed the resolutions for the appointment of Directors before the shareholders for their consent.

Mr. Hemant J. Jhaveri and Mrs. Kavita J. Jhaveri have resigned from the Board with effect from 18th November 2010.

The Board places on record their appreciation for the valuable services rendered by them during their tenure as Directors of the Company.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to section 217(2AA) of the Companies Act, 1956, your Director, based on the representations received from the Operating Management, and after due enquiry, confirm that

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

ii) They have, in the selection of the accounting policies, consulted the statutory Auditors and these have been applied consistently and reasonable and so as to give a true and fair view of the state of affairs of the company as at 31st March, 2011 and of the profits (losses) incurred by the Company for the year ended on that date.

iii) Proper and sufficient care has been taken for the maintenance of adequate accounting record with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and others irregularities:

iv) The annual accounts have been prepared on a going concern basis.

PARTICULARS OF EMPLOYEES

There are no employees drawing salaries whose particulars are required to be Annexed in accordance with the provision of Section 217(2A) of the Companies Act, 1956 read with the Companies (particulars of Employees) Rules, 1975 as amended till date.

FIXED DEPOSITS

The Company has not accepted any Fixed Deposits during the year under review within the meaning of the Companies Act, 1956 and the rules made there under.

AUDITORS

Mr. Hiteshkumar Shah, Chartered Accountants, retire as Auditors of the Company at the end of the ensuing Annual General Meeting and being eligible, has offered themselves for reappointment. Your Directors request you to reappoint them as the Statutory Auditors for the current financial year.

ACKNOWLEDGEMENTS

Your Directors express their gratitude to the Financial Institution and Banks for their valuable support, continued co-operation and encouragement to the company. Your Directors wish to place on record their appreciation of efforts, assistance and support of the employees at various levels of the company.

Your Directors thank you and look forward to your continuing support.

By Order of the Board of Directors

FOR JHAVERI WELDFLUX LIMITED

Sd/-

Date : 4th August, 2011. Jayesh Jhaveri

Place : Vashi, Navi Mumbai Chairman and Executive Director


Mar 31, 2010

The Directors present herewith the 19th Annual Report and the Audited Statement of the Company for the financial year ended 31 March, 2010.

FINANCIAL RESULTS (Rs. In Lacs)

March March 2009 2010

Turnover 03.45 2.08

Profit/(Loss) before Interest and Depreciation (13.76) (1.21)

Interest - -

Profit/(Loss) after interest but before depreciation (13.76) (1.21)

Depreciation 03.13 -

Profit/(Loss) after interest and Depreciation (16.89) (1.21)

Profit/(Loss) before Tax (16.89) (1.21)

Taxation - -

Loss after Tax (16.89) (1.21)

Balance Carried to balance sheet (16.89) (1.21)

PERFORMANCE OF THE COMPANY:

The company has cleared off all its secured liabilities except deffered sales tax liabilities amounting to Rs. 11,89,707/-. The total debts of the company are Rs.34,92,082 out of which nerly 97.76% amounting to Rs.34,13,721 are more than six months old out of which court cases for nearly 78.14% for Rs. 26,67,613 have been filed.

The trading of the company's shares have been suspended on the stock exchanges due to non compliance of the listing agreement. The Listing fees of the Bombay stock Exchange & The Ahmedabad Stock Exchanges are pednding from the year 2006-2007

DIVIDEND

In view of the losses being suffered by the company and the capital & reserves of the company being wiped out by nearly 92.64°o the directors are not in a position to declare any dividends and so dividend is not recommend for the year.

DIRECTORS

Mr.Pankaj Jhaveri retires by rotation at this Annual General Meeting and being eligible offers himself for reappointment

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors, based on the representations received from the Operating Management and after due enquiry, confirm that:-

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

ii) They have, in the selection of The accounting policies, consulted die statutory Auditors and these haw been applied consistently and reasonable and so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and of the losses incurred by the Company for the year ended on that date;

iii) Proper and sufficient care has been taken for the maintenance of adequate accounting record with the provisions of the Companies Act,1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) The annual accounts have been prepared on a going concern basis.

PARTICULARS OF EMPLOYEES:

There are no employees drawing salaries whose particulars are required to be annexed in accordance with the provisions of Section 217(2A) of the Companies Act,1956 read with the Companies (particulars of Employees) Rules, 1975 as ammended till date.

FIXED DEPOSITS:

The Company has not accepted any Fixed Deposits during the year under review within the meaning of the Companies Act,1956 and the rules made thereunder.

AUDITORS :

Mr. Hiteshkumar Shah, Chartered Accountants, retire as Auditors of the Company at the end of the ensuing Annual General Meeting and being eligible, have offered themselves for reappointment. Your Directors request you to reappoint them as the Statutory Auditors for the current financial year.

ACKNOWLEDGEMENTS:

Your Directors express their gratitude to the Financial Institution and Banks for their valuable support, continued co-operation and encouragement to the company. Your Directors wish to place on record their appreciation of the efforts, assistance and support of the employees at various levels of the Company.

Your Directors thank you and look forward to your continuing support.

BY ORDER OF THE BOARD OF DIRECTORS

FOR JHAVERIWELDFLUX LIMITED

Pankaj Jhaveri

Chairman /Managing Director.

Place: Vashi, Navi Mumbai

Date: 28th June, 2010

Regd Office: 27/28th Panchsheel Indl.Est.,Kharsundi. khalapur, Raigad, Maharashtra.

 
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