Home  »  Company  »  Vikash Metal & Power  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of Vikash Metal & Power Ltd.

Mar 31, 2011

Dear Shareholders,

The Directors take pleasure in presenting the 15th Annual Report on the business and operations of your Company together with the Audited Accounts for the year ended 31st March, 2011.

FINANCIAL AND PERFORMANCE REVIEW (Rs. in Lacs)

Particulars 2010-11 2009-10

Sales (Net of Excise Duty) 84,988.46 69,185.69

Other Income 156.44 168.04

Total Income 85,144.90 69,353.73

Less:Total Expenses (80,574.39) (65,685.03)

Profit before Depreciation, Interest & Tax 4,570.51 3,668.70

Less: Interest (2,194.80) (2,210.54) Depreciation (885.57) (876.20)

Profit before Tax 1,490.14 581.96

Less: Provision for Current Tax (310.24) (103.26)

Provision for Deferred Tax (452.10) (163.84)

Deferred MAT credit entitlement 296.99 98.90

Profit after Tax 1,024.79 413.76

Less: Income Tax for earlier years (8.60) (42.09)

Add : Profit brought forward from Previous year 3,029.64 2,760.35

Profit available for appropriation 4,045.83 3,132.02

Proposed Dividend on equity shares (177.98) (87.80)

Corporate Tax on Dividend (28.87) (14.58)

Balance carried to Balance Sheet 3,838.98 3,029.64

During the financial year under review, the gross turnover of your Company increased from ? 70730.28 Lacs to ? 87980.46 Lacs, registering a growth of about 23% compared to previous financial year 2009-10 while

Profit Before Tax (PBT) increased by 156% to Rs. 1490.14 lacs (Previous year Rs. 581.96 Lacs) and Profit After Tax (PAT) increased by 173% to Rs. 1016.19 Lacs (Previous year Rs. 413.76 Lacs). Earnings per Share for the year is ? 2.89 compared to ? 1.06 for the previous year. Thus, your Company delivers a healthy growth in the sales and profitability.

DIVIDEND

The Company's dividend policy is based on twin objectives to appropriately reward the Shareholders and at the same time to keep enough capital to fuel growth needs., Accordingly, your directors recommend a final dividend of 2.5% on Equity shares of Rs. 10/-each i.e Rs. 0.25 per equity share for the year ended 2010-11 .The proposed dividend, if approved, at the ensuing Annual General Meeting would result in appropriation of Rs. 177.98 Lacs (in addition to the Corporate Dividend Tax of Rs. 28.87 Lacs) out of the profits.

DIRECTORS

In accordance with the requirements of the Companies Act, 1956, and Articles of Association of the Company Mr. Vijay Kumar Jain, Director of your Company, will retire by rotation at the ensuing Annual General Meeting and, being eligible, offers himself for reappointment. The Board recommends his re-appointment as Director of your Company.

INCREASE OF AUTHORISED SHARE CAPITAL AND ISSUE OF GLOBAL DEPOSITORY RECEIPTS (GDRs) OF THE COMPANY

The authorized share capital of your Company was increased from Rs. 60 crores to Rs. 100 crores in order to facilitate the issue of Global Depository Receipts. In April, 2011, the company has raised US$ 11,999,952 through this issue. The Company's GDRs are listed on the Luxembourg Stock Exchange.

STATUTORY DISCLOSURE

None of the Directors of the Company are disqualified as per the provisions of Section 274(1) (g) of the Companies Act, 1956. All the Directors have made the necessary disclosures as required under various provisions of the Companies Act, 1956 and Clause 49 of the Listing Agreement.

AUDITORS & AUDITORS' REPORT

M/s. S. Jaykishan, Chartered Accountants, the Statutory Auditors of the Company are retiring at the conclusion of the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. Certificate from the Auditors has been obtained to the effect that their re-appointment, if made, would be within the limits prescribed under section 224(1 B) of the Companies Act, 1956.

The Auditors' Report and the notes forming part of the accounts are self explanatory and hence does not require to be elucidated further.

FIXED DEPOSIT

The Company did not invite/accept any fixed deposit from the public during the year under review and as such there are no outstanding deposits in terms of the Companies (Acceptance of Deposits) Rules, 1975.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to section 217 (2AA) of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that:

a) in preparation of statement of accounts for the financial year under review, the applicable Accounting Standards have been followed and in case of departures there from, proper explanations relating thereto have been given in the notes forming part thereof.

b) Accounting Policies selected have been applied consistently and judgments and estimates made are reasonable and prudent and they give true and fair state of affairs of the Company at the end of the financial year under review and of the profit of the Company for that period.

c) Proper and sufficient care has been taken 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.

d) Annual Accounts have been prepared on a going concern basis.

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

Information pursuant to Section 217(1 )(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 regarding conservation of energy, technology absorption and foreign exchange earnings and outgo is given in Annexure 'A'.

ACKNOWLEDGEMENT

Your Directors wish to place on record their sincere appreciation of the financial institutions and consortium of banks led by Bank of India and Company's customers and investors for their continued support during the year.

Your Directors also wish to place on record their appreciation for the dedication and contribution made by employees at all levels and look forward to their support in future as well.

For and on behalf of the Board of Directors

Place :Kolkata Vimal Kumar Patni Date: 21st July,2011 Chairman


Mar 31, 2010

The Directors take pleasure in presenting the 14th Annual Report together with the Audited Accounts for the year ended 31st March, 2010.

FINANCIAL AND PERFORMANCE REVIEW (Rs. in Lacs)

Particulars 2009-10 2008-09

Sales (Net of Excise Duty) 69185.69 59357.68

Other Income 168.04 269.70

Total income 69353.73 59627.38

Less: Total Expenses (65685.03) (56554.94)

Profit before Depreciation, interests Tax 3668.70 3072.44

Less: Interest (2210.54) (1337.40)

Depreciation (876.20) (716.74)

Profit before Tax 581.96 1018.30

Less: Provision for Current Tax (103.26) (120.22)

Provision for Fringe Benefit Tax - (7.22)

Provision for Deferred Tax (163.84) (354.97) Deferred MAT credit entitlement 98.90 115.37

Profit after Tax 413.76 651.26

Less: Income Tax for earlier years (42.09) (30.00)

Add : Profit brought forward from Previous year 2760.35 2241.81

Profit available for appropriation 3132.02 2863.07

Proposed Dividend on equity shares (87.80) (87.80)

Corporate Tax on Dividend (14.58) (14.92)

Balance carried to Balance Sheet 3029.64 2760.35

During the year under review, the gross turnover of your Company increased from Rs. 61678.11 Lacs to Rs. 70730.28 Lacs, yielding a growth of about 15%. Profit before Tax (PBT) and Profit after Tax (PAT) were Rs. 581.96 Lacs and Rs. 413.76 Lacs respectively. After witnessing a sharpest downturn in global economy in the previous FY 2008-09, the FY 2009-10 was an extremely challenging year for your Company.

INDUSTRY STRUCTURE, DEVELOPMENTS, OPPORTUNITIES, THREATS, RISKS AND CONCERNS AND FUTURE OUTLOOK

Presently, India is 5th largest producer of steel in the world and recorded a growth of 2.7% as compared to 2008. India also emerged as the largest sponge iron producing country and important producer of Pig Iron.

Your Company is in the manufacturing of Sponge Iron, Pig Iron, MS Billets, TMT Bars, Ferro Alloys and also in generation of Power. Thus,

serving a large section of structural & infrastructure industries with slogan From Structure to Infrastructure. "Vikash" brand TMT bars are supplied to leading construction companies and turnkey projects. Your Directors are happy to inform that your Company has received an allotment for Moira Madhujore North & South non coking coal block in the state of West Bengal from Ministry of Coal, Govt, of India, in a joint venture with other reputed companies. This Joint Venture is being set up through a separate company titled Moira Madhujore Coal Limited (MMCL), which has been incorporated with the Registrar of Companies, West Bengal. Your Companys share in this Joint Venture is 23.32%. Therefore, your Company is well-poised to take advantage of the growth in the Iron and Steel sector.

As the Indian Steel Industry integrates more and more with global industry, it will have to tackle some key issues for retaining its competitive edge and increasing its international presence. Some of the prominent risks faced by the Company are of Human Resource, Natural Calamities, Competitive environment, Market condition, etc.

The downturn in the global economy is set to recover at a faster rate than expected earlier though at varied pace across geographies and economies. Buoyed by expected strong performance from the consuming segments like automobile, construction, infrastructure, etc it is expected that the situation will remain favourable for the Company.

DIVIDEND

The Companys dividend policy is based on twin objectives to appropriately reward the shareholders and at the same time to keep enough capital to fuel growth needs. Accordingly, your Directors recommend a final dividend of Re. 0.25 per share on 3,51,20,100 fully paid equity shares of Rs. 10/- each for the year ended 2009-10. The proposed dividend, if approved, at the ensuing Annual General Meeting would result in appropriation of Rs. 87.80 Lacs (in addition to the Corporate Dividend Tax of Rs. 14.58 Lacs) out of the profits.

The Register of Members and share transfer books shall remain closed from 15th September, 2010 to 22nd September, 2010 (both days inclusive) for the purpose of Annual General Meeting and payment of dividend.

DIRECTORS

In accordance with the requirements of the Companies Act, 1956, and Articles of Association of the Company Mr. Vimal Kumar Patni, Director of your Company, will retire by rotation at the ensuing Annual General Meeting and, being eligible, offers himself for re-appointment. The Board recommends his re-appointment as Director of your Company.

STATUTORY DISCLOSURE

None of the Directors of the Company are disqualified as per the provisions of Section 274(l)(g) of the Companies Act, 1956. All the Directors have made the necessary disclosures as required under various provisions of the Companies Act, 1956 and Clause 49 of the Listing Agreement.

AUDITORS & AUDITORSREPORT

M/s. S. Jaykishan, Chartered Accountants, the Statutory Auditors of the Company are retiring at the conclusion of the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. Certificate from the auditors has been obtained to the effect that their re-appointment, if made would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

The notes to the accounts referred to in the Auditors Report are self explanatory, and therefore, do not call for any further comment.

The outstanding income tax amounting to Rs. 291.83 Lacs as at 31st March, 2010 as observed by the Auditors at point no. (ix)(a) in annexure to their report has hence been paid. Term Loan installment with interest outstanding to Banks as at 31st March, 2010 as observed by the Auditors at point no. (xi) is also been paid.

FIXED DEPOSIT

The Company did not invite/accept any fixed deposit from the public during the year under review and as such there are no outstanding

deposits in terms of the Companies (Acceptance of Deposits) Rules, 1975.

DIRECTORS RESPONSIBILITY STATEMENT

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

a) in preparation of statement of accounts for the financial year under review, the applicable Accounting Standards have been followed and in case of departures therefrom, proper explanations relating thereto have been given in the notes forming part thereof.

b) Accounting Policies selected have been applied consistently and judgments and estimates made are reasonable and prudent as they give true and fair state of affairs of the Company at the end of the financial year under review and of the profit of the Company for that period.

c) proper and sufficient care has been taken 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.

d) Annual Accounts have been prepared on a going concern basis.

COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORTOF BOARD OF DIRECTORS) RULES, 1988

Information pursuant to Section 217(l)(e) of the Companies Act, 1956 read with 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 AnnexureA.

CORPORATE GOVERNANCE/INTERNAL CONTROL SYSTEM

Your Company continues to be committed to good Corporate Governance aligned with the good practices. Your Company is in compliance with the standards set out by clause 49 of the Listing Agreement with the Stock Exchanges. A detailed report on Corporate Governance compliance duly certified by the Companys Statutory Auditors forms part of this report as Annexure B.

Your Company has in place adequate systems of internal control commensurate with its size and the nature of its operations. The Company has an Audit Committee which actively reviews the adequacy and effectiveness of Internal control systems and suggest improvements for strengthening them from time to time.

HUMAN RESOURCES AND INDUSTRIAL RELATIONS

Your Company firmly believes in the immense potential of its human resources in developing the organization and ensuring its success. The Company endeavors to keep the employees motivation level high by providing conducive work atmosphere and remunerating adequately. During the year under review, Industrial Relations remained cordial.

During the year under review, no employee of your Company was in receipt of remuneration in excess of the limits specified under the provision of Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975.

SEGMENT WISE/PRODUCT WISE PERFORMANCE

Your Company is engaged mainly in the manufacturing and selling of Iron and Steel products. Thus, the Company primarily operates in one reportable segment i.e., Iron and Steel and all products manufactures fall under this segment. The Company also generates power from its captive power plant which is entirely consumed in its manufacturing unit.

CAUTIONARY STATEMENT

Statements in this Directors Report & Management Discussion and Analysis Report describing the Companys activities, projections about the future, estimates, assumptions with regard to global economic conditions and Government policies, etc. have been made in good faith and may be "forward looking statements" within the meaning of

Place : Kolkata

Date :21st July, 2010

applicable securities laws and regulations. Many unforeseen factors may come into play and affect the actual results which might differ from those either expressed or implied. Market data was based on information gathered from various published and unpublished sources and their reliability and completeness cannot be assured.

ACKNOWLEDGEMENT

Your Directors wish to place on record their sincere appreciation of the financial institutions and consortium of banks led by Bank of India and Companys customers and investors for their continued support during the year.

Your Directors also wish to place on record their appreciation for the dedication and contribution made by employees at all levels and look forward to their support in future as well.

For and on behalf of the Board of Directors

Vimal Kumar Patni

Chairman

Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X