Mar 31, 2015
The Directors have great pleasure in presenting the 23rd Annual Report
together with Audited Statements of Accounts of the Company for the
year ended March 31, 2015.
Financial Results (Rs. in Lakhs)
2014-2015 2013-2014
Net Sales (Turnover) 3205.52 2,638.57
Other Income 4.06 8.95
Financial Charges 347.29 396.52
Depreciation 343.59 410.33
Misc. Expenses written off 0 0
Profit/(Loss) before tax (PBT) (1533.46) (962.02)
Deferred Tax 878.25 0
Net Profit/(Loss) <2411.71) (962.02)
FINANCIAL ANALYSIS AND PERFORMANCE REVIEW
During the fiscal 2014-15, the turnover of the Company increased to Rs.
3,205.52 Lakhs as compared to Rs. 2,638.57 Lakhs in the previous year.
However due to sluggish market, increase in labour, power and other
operational costs , and financial constraints , Company could not
optimally utilize its capacities and its lossess increased to Rs.
2,411.71 Lakhs as compared to Rs. 962.02 Lakhs in the previous year.
Further, over the period the company has eroded its net worth
completely and it has been declared as a Sick Company under Sick
Industrial Companies (Special Provisions) Act'1985 by the Board for
industrial and financial restructuring (BIFR) vide its order dated 18th
July'2012. Management Discussion and Analysis Indian Textile Industry
is one of the leading textile Industries in the world. The textile
sector has always been an important part of people's lives in India.
The textile sector is highly diverse and has hand-spun and hand woven
segments at one end of the spectrum, and capital- intensive,
sophisticated and modern mills at the other. India's Textile Industry
is largely dependent on textile manufacturing and export and India
earns about 17% of its foreign exchange through Indian textile exports.
The Indian Textile Industry also contributes 5% of the GDP and employs
more than 35 million people, the second largest employment only after
agriculture, and 14% of the industrial production of the country.
However, for Amit Spinning the last fiscal was very difficult and
challenging mainly due to sluggish market demand and rapid &
significant increase in labour, power and other operating costs and
shortage of working capital .which lead to fall in EBITDA levels.
M/s Amit Spinning Industries Limited has already been declared as a
Sick Company under SICA by BIFR and the UCO Bank has been appointed as
the Operating Agency. However, with an attempt to safeguard the
interests of the stakeholders particularly employees, unit has been
engaged in carrying out under job work.
Management is confident that once the rehabilitation scheme is approved
by the BIFR, Company will turn around and recover from the current
difficult phase and accordingly it is in process of reviewing its
strategic plans and looking at means to find a way to increase its
turnover, reduce its costs and achieve a higher value addition so that
it could achieve positive result in the near future. Segment-Wise
Performance
Amit Spinning Industries Ltd. (ASIL) being a cotton yarn manufacturer
has only one business segment. On the basis of geographical
categorization of market, ASIL identified two segments i.e. exports and
domestic.
During the year under review, Company has manufactured 1281.64 MT of
yarn on its own resources and 1112.65 MT of yarn on job work basis.
Subsidiary Companies
As there are no subsidiaries/ associates / joint ventures of the
Company, the provisions contained in Companies Act, 2013/Listing
Agreements relating to subsidiaries are not applicable. Share Capital
The Company's issued and paid up capital as on 31st March, 2015 stands
at Rs. 20,58,48,335/- divided into 4,11,69,667 fully paid up equity
shares of Rs. 5/- each. During the year, under review, the Company has
not issued any share(s). Further the Company has not issued any share
with differential Voting Rights/Sweat Equity shares/under Stock Option
Scheme (ESOS) earlier and during the year.
The Company has no scheme of provision of money for purchase of its own
shares by employees or by trustees for the benefit of employees. Hence
the details under rule 16 (4) of Companies (Share Capital and
Debentures) Rules, 2014 are not required to be disclosed. Management
Perception On Opportunities, Risks, Concern & Outlook The potential
size of the Indian textile industry is expected to reach US$220 billion
by 2020. Government has allowed 100% FDI in the Indian textiles sector
under the automatic route. Further, the Government has proposed the
establishment of Centers of Excellence for training the workforce in
the textile sector and also to establish institutes under the
public-private partnership (PPP) model to encourage private sector
participation in the development of the industry. However due to change
in China policy, Indian exports have been affected and showed down by
50% in the graph of financial year 2014-15, but could recover partially
in the year 2015-16 to 1.2 million tones.
Further, Government has approved a debt restructuring package to help
loss making textile mills to be administered on case by case basis by
the banks within the prudential norms of the Reserve Bank of India.
Also, BIFR has decided on reliefs / concessions etc. to be given to
units / companies on the revival packages which will prove to be
beneficial for Amity Spinning Industries Limited, as well.
Further, with focus on Make in India, the Indian Textile industry is
expected to become resilient and robust through various support
measures likely to be announced by the government. The future outlook
for the Indian Textile Industry looks promising, buoyed by both strong
domestic consumption and increase in export turnover.
Slow but potentially promising increase in demand of cotton yarn in
domestic market and talk of economic reforms by the new government as
well as encouraging export promotion policy for textile sector have
already improved market sentiments to some extent. With the awaited
approval of rehabilitation scheme by BIFR and with the continued
support and co-operation of company's bankers, management believes that
your Company would again initiate its own production, optimally utilize
capacities, increase sales volumes, and consequently margins are also
expected to be strengthened in due course. Directors
(a) Change in Directors or Key Managerial Personnel
In terms of provisions of the Companies Act, 2013 read with Clause 49
of Listing Agreement, during the year, Ms. Priya Lohani has been
appointed as Additional Director in the position of Woman Director on
the Board of the Company w.e.f. 31st March, 2015 and holds office upto
ensuing Annual General Meeting. She however being eligible for
reappointment, company has received an application from the member for
consideration of her appointment as women director on the board in the
ensuing Annual General Meeting itself. During the period under review,
Mr. Shreyas S Alatkar, Manager Accounts has been entrusted with
responsibility to discharge the functions of CFO (Chief Financial
Officer) along with other functions of the Company w.e.f 13th February,
2015 in place of Mr. Mahesh Anand Raut, who was appointed as CFO on
11th August, 2014.
Mr. K Sankaramani is retiring by rotation in the forthcoming Annual
General Meeting and being eligible, offer himself for re-appointment.
Brief resume of the Directors proposed to be appointed/re-appointed,
nature of their expertise in specific functional areas and names of the
companies in which they hold directorship and membership/chairmanships
of the Board or its Committees, as stipulated under Clause 49 of the
listing agreement entered by the Company with stock exchanges in India,
is provided in the Report of Corporate Governance forming part of the
Annual Report.
(b) Number of Meetings of the Board
Four meetings of the Board were held during the year. The detailed
information regarding meetings of the Board held during the year is
mentioned in the Corporate Governance Report which forms part to this
report.
(c) Declaration by Independent Directors
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
(d) Annual Evaluation by the Board
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has carried out an annual performance
evaluation of its own performance, the directors individually as well
as its Committees. The manner in which the evaluation has been carried
out has been explained in the Corporate Governance Report.
(e) Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection and appointment of Directors,
Senior Management and their remuneration. The Remuneration Policy is
stated in the Corporate Governance Report. During the year, neither the
Managing Director nor the Whole-time Directors of the Company received
any remuneration or commission from any of its subsidiaries.
Directors' Responsibility Statement
Pursuant to the requirement of Section 134(3)(c) of the Companies Act,
2013, with respect to Directors' Responsibility Statement, it is hereby
confirmed that:
(a) in the preparation of the annual accounts for the financial year
ended 31st March, 2015, 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 as at March 31, 2015 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 the Companies Act, 2013 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.
(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. Related Party Transactions All
related party transactions that were entered into during the financial
year were on an arm's length basis and were in the ordinary course of
business. Company has entered into a material transaction with one
related party i.e. its holding Company M/s Spandex Industries Limited
according to the policy framed for the related party transactions and
the same has been disclosed in the note to financial statements.
However there were no other materially significant related party
transactions entered into by the Company with Promoters, Directors, Key
Managerial Personnel or other designated persons which may have a
potential conflict with the interest of the Company at large.
Prior omnibus approval of the Audit Committee was obtained for Related
Party Transactions for a period up to 31st March, 2015 and for the
financial year 2015-16. The transactions entered into pursuant to the
omnibus approval so granted were audited and a statement giving details
of all related party transactions were placed before the Audit
Committee for its review on a quarterly basis.
The Company has framed a Related Party Transactions Policy for purpose
of identification and monitoring of such transactions. The policy on
Related Party Transactions as approved by the Board has been uploaded
on the Company's website.
None of the Directors has any pecuniary relationships or transactions
vis-a-vis the Company. All related party transactions entered into by
the Company were in ordinary course of business and were on an arm's
length basis, however for the transaction entered with its holding
company fall under material transaction and details of the same is
mentioned in form AOC - 2 attached herewith as Annexure-1.
Significant and Material Orders passed by the Regulators or Courts
There are no significant or material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and
its future operations.
Auditors
(a) Statutory Auditors
M/s. Sunil Jain & Co., Chartered Accountants, (Registration No.
003855N) have been appointed as Statutory Auditors of the Company at
22nd Annual General Meeting held on 11th September, 2014 to hold office
until conclusion of 26th Annual General Meeting for a period of four
years, as provided in Section 139 of the Companies Act, 2013, the said
appointment is being placed for ratification at the forthcoming Annual
General Meeting.
The Company has received a confirmation from M/s. Sunil Jain & Co.,
Chartered Accountants to the effect that their appointment, if made, at
the ensuing AGM would be in terms of Sections 139 and 141 of the
Companies Act, 2013 and rules made there under and that they are not
disqualified for re-appointment. Auditors Report The Auditors' Report
read with the Notes to Accounts is self-explanatory and do not call for
any further explanation under Section 134 of the Companies Act, 2013,
except for the responses in respect of some observations as mentioned
here in below. Directors' view on Auditor's Observations Directors'
response to the various observations of the auditors made in their
report, has been explained wherever necessary through appropriate notes
to accounts, however pertinent notes are reproduced hereunder in
compliance with the relevant legal requirements and wherever required
further explanation is furnished:
Note No. 30 of the Financial Statement qualified by Auditors
"The Loans and Advances of the Company include a sum of Rs.1,93,46,572,
being an amount receivable from Customs Department as drawbacks against
the export sale pertaining to the period 1993 to September, 2004 when
the unit was 100% Export Oriented Unit (EOU). The company has earlier
filed an application with the office of DGFT for the claim and made
significant efforts for receiving the claim. The Company has also filed
claim against Jak Traders Private Ltd. for recovery of the claims.
Note No. 31 of the Financial Statement without qualifying, Auditors
have drawn attention
"As on March 31, 2015, the accumulated losses of the Company have far
exceeded its net worth. In the opinion of the management, the Company's
operations are affected by global business downturn which has resulted
in reduction in demand, increase in input costs and shortage of working
capital. The Company has also filed a reference with Board for
Industrial and Financial Restructuring (BIFR) under Section 15 of Sick
Industrial Companies (Special Provisions) Act, 1985 for determination
of sickness and measures to be adopted for rehabilitation. The BIFR,
vide its order, dated 18.07.2012 declared the Company as sick under
section 3(1)(o) of SICA, 1985 and appointed UCO Bank as Operating
Agency (OA) under section 17(3) to prepare Rehabilitation Scheme for
the Company. However, on the strength of management's plan of revival
including reorganization of business, these financial statements are
prepared on a going concern basis.
(b) Cost Auditor
Pursuant to recent amendment to the Companies (Cost Records and Audit)
Rules, 2014, the provision relating to carry out cost audit is not
applicable to the Company for financial year 2015-16.
(c) Secretarial Auditor & Audit Report
Pursuant to provisions of Section 204 of the Companies Act, 2013, the
Company has appointed M/s. Loveneet Handa & Associates, Practicing
Company Secretary (having CP No. 10753 & Membership No. 25973) as
Secretarial Auditor to carry out the secretarial audit for the
financial year 2014-2015.
The Secretarial Audit Report for the financial year ended March 31,
2015 is annexed herewith marked as Annexure 2 to this Report. There
are no qualifications or observations or remarks made by the
Secretarial Auditors in their Report.
(d) Internal Auditors
Pursuant to section 138 of the Companies Act, 2013 read with The
Companies (Accounts) Rules, 2014, the Company has appointed Dr. Sunil
Kumar Gupta as the Internal Auditor of the Company. Internal Control
Systems and Adequacy The Company has established adequate internal
control systems, commensurate with its size and nature of business and
such systems are periodically audited, verified and reviewed for their
validity, considering the changing business scenario from time to time,
the Audit Committee of the Board of Directors reviews the adequacy and
effectiveness of internal control systems and suggests improvement for
strengthening them from time to time.
Extract of the Annual Return The details forming part of the extract of
the Annual Return in form MGT 9 is annexed herewith as Annexure-3 to
this Report. Conservation of Energy , Technology absorption and
Foreign Exchange Earnings and Outgo Company has implemented energy
conservation methods and such action has resulted into major savings in
energy consumption as well as in cost control.
The information as required to be disclosed under Section 134(3)(m) of
the Companies Act, 2013 read with Rule, 8 of the Companies (Accounts)
Rules, 2014 is set out in the Annexure - 4 to this Report. Particulars
of Employees None of the employee has received remuneration exceeding
the limit as stated in rule 5(2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 read with the
Companies(Particulars of Employees) Rules, 1975, as amended, hence no
particulars are required to be given herein. Deposits The Company has
not accepted or renewed any deposit during the year and there are no
outstanding and/or overdue deposits as at 31st March, 2015.
Particulars of Loans, Guarantees or Investments
Details of loans, Guarantees and Investments covered under the
provision of Section 186 of the Companies Act, 2013 are given in the
notes to the Financial Statements. Risk Management A Risk Management
Committee has been constituted to oversee the risk management process
in the Company as required under the Companies Act, 2013 and Clause 49
of the Listing Agreement. The details of the Committee and its terms of
reference are set out in the Corporate Governance Report forming part
of the Board's Report. The Risk Management Policy has also been hosted
on the website of the company Vigil Mechanism The Company has framed
and implemented a vigil mechanism named as Whistle Blower Policy to
deal with instances of fraud and mismanagement, if any. The details of
the Whistle Blower Policy are provided in the Corporate Governance
Report and also posted on the website of the Company.
During the year under review, there were no cases filed pursuant to the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013. Dividend During the year under review, the
Company has no distributable profits hence your Directors do not
recommend payment of any dividend. Transfer To Reserves During the
year, the Company has not transferred any amount to reserves. Material
changes between the date of the Board Report and end of financial year
Due to market and financial constraints, the Company was not able to
fully utilize and leverage its production capacity and the
Rehabilitation Plan filed by the Company with BIFR is yet to be
considered and approved, resultantly management was left with no option
but to keep the manufacturing unit situated at Kolhapur, Maharashtra
inoperative. Human Resources/Industrial Relations The Company and its
management value the talent, commitment and dedication of its employees
and acknowledge their contribution. All employees in the Company work
as a team and integral part of the family, sharing their ideas and
concerns through discussions, Town Hall meetings and intranet network
installed across the units.
Industrial Relations scenario at the continues to be healthy and
enthusiastic. Information Technology Information Technology continues
to be an integral part of your company's business strategy. The Company
is working on SAP platform integrating its business processes,
financial parameters, customer transactions and people, effectively on
real time basis. Change in the nature of Business There is no change
in the nature of the business of the company. Corporate Governance and
Management Discussion and Analysis As stipulated under Clause 49 of the
Listing Agreement entered into with Stock Exchanges, a report on
Corporate Governance is attached separately as a part of the Annual
Report and the Management Discussion and Analysis (MD & A) is included
in this report so that duplication and overlap between Directors'
Report and a separate MD & A is avoided and the entire information is
provided in a composite and comprehensive manner. Listing of Shares
Presently Company's shares are listed and traded at the BSE Limited,
Mumbai (BSE) and National Stock Exchange of India, Mumbai (NSE). Due
to financial crises and running the manufacturing unit on job work
basis, the Annual Listing Fee for the financial year 2015-16 is yet to
paid to BSE & NSE and Company is in process of making payment there for
in due course. Conclusion Your company is presently going through
challenging and difficult period due to market and financial
constraints. It has already been declared as a Sick Company under Sick
Industrial Companies (Special Provisions) Act, 1985 by BIFR vide its
order dated 18th July'2012, and UCO Bank has been appointed as an
Operating Agency to work out DRS for the Company in consultation with
lenders. It is however expected, on Company receiving BIFR approval for
its DRS, it would be in a better position to augment its production and
sales, by utilizing its capacities optimally. In the meanwhile to meet
its day to day expenses, fixed expenses and expenses relating to
Employees/workers, it is undertaking job work from other yarn
manufacturers. Acknowledgments The Directors take this opportunity to
express their grateful appreciation for the whole hearted and sincere
co-operation the Company had received from the various departments of
Central and State Government, Bankers, Financial Institutions,
Customers, Suppliers and Contractors as well as Members of the Company
during the year under review of the Company. The Directors also wish to
place on record the appreciation for the contribution made by all the
employees at all levels and hope that with their continued commitment
and dedication the Company could look forward to more profitable
operations ahead.
On behalf of the BOARD OF DIRECTORS
Sd/-
Place New Delhi S P SETIA
Date : August 11, 2015 CHAIRMAN
Mar 31, 2014
Dear Members,
The Directors have great pleasure in presenting the 22nd Annual Report
together with Audited Accounts of the Company for the year ended March
31, 2014.
Financial Results: (Rs. in Lakhs)
2013-2014 2012-2013
Net Sales (Turnover) 2,638.57 3,482.76
Other Income 8.95 8.81
Financial Charges 396.52 202.36
Depreciation 410.33 454.17
Misc. Expenses written off 0 0
Profit/(Loss) before tax (PBT) (962.02) (305.20)
Provision for Taxation 0 0
Net Profit/(Loss) (962.02) (305.20)
FINANCIAL ANALYSIS AND PERFORMANCE REVIEW:
In view of financial constraints including shortage in working capital
and lack of financial support from Company''s lenders, the turnover of
the Company has decreased to Rs. 2,638.57 lakhs in fiscal 2013-14 as
compared to Rs. 3,482.76 lakhs in the previous year. The Company could
not utilize its entire capacities, to safeguard the interest of the
employees, the manufacturing unit is running under job work basis
accordingly Company''s losses increased to Rs. 962.02 lakhs as compared
to Rs. 305.20 lakhs in the previous year.
MANAGEMENT DISCUSSION AND ANALYSIS
The cotton and textiles industry has an overwhelming presence in the
Indian economy. Apart from providing one of the basic necessities of
life, the textiles industry also plays a pivotal role through its
contribution to industrial output, employment generation and export
earnings of the country. India has improved its ranking as per the
recent data released by ''UN Comtrade'' in Global Textiles as well as
Apparel Exports. In Global Textiles Exports, India now stands at second
position beating its competitors like Italy, Germany and Bangladesh,
with China still retaining its top position. However, the contribution
of the textile industry in terms of percentage to industrial production
and export earnings is constant at 12% during the last three years and
current year.
However as per the data available with the Textile Commissioner, 104
cotton/man-made fibre textiles mills (Non SSI) closed across the
country during last three years. Out of 104 mills, 34 textile cases are
registered with BIFR as on 31.12.2012.
Unfortunately, M/s Amit Spinning Industries Limited is one among the 34
textile cases which is registered with BIFR due to shortage in working
capital requirement. However, to meet current challenges which include
fixed cost, overhead expenses, payment of lenders dues and to safeguard
the employee''s interest, unit is running on job work basis.
It is very difficult for the Company to overcome the losses promptly in
this challenging scenario where labour cost and other costs are
increasing at a rapid rate but still Company is in process of reviewing
its objectives and tools to find a better way ahead to increase its
turnover, reduce its costs and achieve a higher value addition so that
it come out with the positive result in the near future.
SEGMENT-WISE PERFORMANCE
Amit Spinning Industries Ltd. (ASIL) being a cotton yarn manufacturer
has only one business segment. On the basis of geographical
categorization of market, ASIL identified two segments i.e. exports and
domestic.
During the year under review, Company has manufactured 5123.08 MT of
yarn on job work basis against the 4983.01 MT of yarn in the previous
year on job work basis.
INTERNAL CONTROL SYSTEMS AND ADEQUACY
The Company has established adequate internal control systems,
commensurate with its size and nature of business and such systems are
periodically audited, verified and reviewed for their validity,
considering the changing business scenario from time to time, the Audit
Committee of the Board of Directors reviews the adequacy and
effectiveness of internal control systems and suggests improvement for
strengthening them from time to time.
MANAGEMENT PERCEPTION ON OPPORTUNITIES, RISKS, CONCERN & OUTLOOK
Rebounding of economic growth in key export destinations, the Indian
Textile Industry is reasonably expected to bounce back its margins from
negative to stable. Indian Yarn manufacturers are further likely to be
benefited in the Fiscal 2014-15 due to decreased yarn exports from
China and simultaneous increase in demand for its exports in overseas
market and as well as in domestic market, which will in turn improve
the fortunes of textile sector.
Further, Government has approved a debt restructuring package to help
loss making textile mills which is to be administered on case by case
basis by the banks in accordance with the prudential norms of the
Reserve Bank of India. Also, BIFR''s reliefs / concessions etc. to be
given to units / companies on the revival packages will prove
beneficial for Sick Companies like Amit Spinning Industries Limited.
Devaluation of Indian Rupee has continued to offer an opportunity of
short term benefit to Textile Industry to optimize its day to day sales
volumes and margins, by increased exports. Continued subsidy benefits
under the revised TUF scheme, focus market scheme and reinstating of
export incentives, are further likely to help Amit Spinning to improve
its margins.
As per the latest official figure, while total industrial production
contracted to 0.21% in Apr-Nov''2013, Textile sector output rose to
3.7%. To encourage exports including export of processed clothes,
incentives are available under the Foreign Trade Policy namely Interest
subvention scheme, Market Access Initiative (MAI), Market Development
Assistance(MDA)Schemes and Focus Market & Focus Product Schemes. The
Ministry of Textiles has adopted four pronged strategy for Textiles
exports namely to organize and support larger textiles trade shows,
skill development initiatives, compliance programes and duty drawback
schemes. A provision of Rs.500 crore has been made in the 12th plan for
introducing a scheme for Integrated Processing Development.
The factors like formation of Stable Government, increase in demand of
cotton yarn in domestic market and talk of economic reforms of new
Government, have already improved market sentiments and the same is
showing some recovery signs and further with the support of company
bankers, your directors believe that sales volumes are reasonably
expected to be increased and consequently margins are also expected to
be strengthened in due course.
HUMAN RESOURCES/INDUSTRIAL RELATIONS
The Company and its management value the talent, commitment and
dedication of its employees and acknowledge their contribution.
Consequently, the employee turnover is negligible. Everyone in the
Company is working as a team and is an integral part of a family,
sharing their ideas through Town Hall meeting, using intranet across
the units and are instrumental in making your Company, a globally
admired company. Management of your Company believes that it is the
integration of human resources and business strategy that has
culminated in its success. High performance orientation is the pivot of
the HR philosophy of the Company and all the HR policies and strategies
are centered on the same.
Industrial Relations scenario of the unit continues to be healthy. The
industrial relations during the year under review remained harmonious
and cordial. Your directors wish to place on record their appreciation
for the wholehearted co-operation received from all employees at unit
of the Company.
Dividend
Your directors have not recommended any dividend for the year ended
31-03-2014 under review.
Corporate Governance
As stipulated under Clause 49 of the Listing Agreement entered into
with Stock Exchanges, a report on Corporate Governance is attached
separately as a part of the Annual Report and the Management Discussion
and Analysis (MD & A) is included in this report so that duplication
and overlap between Directors'' Report and a separate MD & A is avoided
and the entire information is provided in a composite and comprehensive
manner.
Directors
Mr. Ranjan Mangtani retires by rotation and being eligible, offers
himself for re-appointment at the ensuing Annual General Meeting.
Pursuant to applicable provisions and Section 149, 150 and 152 of
Companies Act, 2013 Mr. S P Setia, Independent Director and Chairman of
the Company has been appointed as Independent Director for a period of
five years effecting from the ensuing the Annual General Meeting. The
brief resume of the Director to be reappointed, detailing nature of his
expertise in specific functional areas, names of companies in which he
hold directorship(s) and membership(s)/ chairmanship(s) of Board
Committees, shareholding and relationships between directors, inter-se,
as stipulated in Clause 49 of the Listing Agreement entered into with
Stock Exchanges is provided in the Report on Corporate Governance.
Auditors
The Auditors of the Company M/s. Sunil Jain & Co., Chartered
Accountants retire at the ensuing Annual General Meeting and being
eligible offer themselves for re-appointment for a period of four
financial years.
Auditors Report
The Auditors'' Report read together with the Notes to Accounts is
self-explanatory and do not call for any further explanation under
Section 217 (3) of the Companies Act, 1956, except for the responses in
respect of some observations as mentioned here in below.
Directors'' view on Auditors observations
Directors'' response to the various observations of the auditors made in
their report, has been explained wherever necessary through appropriate
notes to accounts, however pertinent notes are reproduced hereunder in
compliance with the relevant legal requirements and wherever required
further explanation is furnished:
Note No. 29 of the Financial Statement qualified by Auditors
"The Loans and Advances of the Company include a sum of Rs.1,93,46,572
being an amount receivable from Customs Department as drawbacks against
the export sale pertaining to the period 1993 to September, 2004 when
the unit was 100% Export Oriented Unit (EOU). The company has earlier
filed an application with the office of DGFT for the claim and made
significant efforts for receiving the claim. The Company has filed
claim against Jak Traders Private Ltd. for recovery of the claims."
Note No. 33 of the Financial Statement qualified by Auditors
"Deferred tax asset amounting to Rs.8,78,24,766 has been recognized up
till 30th June, 2008. Afterwards, in view of brought forward losses,
the Company has decided to not recognise any further deferred tax asset
on prudence consideration."
Note No. 30 of the Financial Statement without qualifying Auditors,
have drawn attention as under:
"As on March 31, 2014, the accumulated losses of the Company have
exceeded its net worth. In the opinion of the management, the Company''s
operations are affected by global business downturn which has resulted
in reduction in demand, increase in input costs and shortage of working
capital. The Company has also filed a reference with Board for
Industrial and Financial Restructuring (BIFR) under Section 15 of Sick
Industrial Companies (Special Provisions) Act, 1985 for determination
of sickness and measures to be adopted for rehabilitation. The BIFR,
vide its order, declared the Company as Sick under Section 3(1)(o) of
SICA, 1985 and appointed UCO Bank as Operating Agency (OA) under
section 17(3) to prepare Rehabilitation Scheme for the Company.
Further, due to shortage of capital, the Company has worked on job-work
basis only during the current year. However, on the strength of an
undertaking from Board of Directors to turn around the financial
position of the Company, these financial statements are prepared on a
going concern basis."
Cost Auditor
The Central Government has approved the appointment of Shri Rajesh
Goyal, Cost Accountant of M/s. K G Goyal & Associates, Cost Accountants
to conduct the audit of the Cost Accounts of the Company for the
financial year ending 31st March, 2014 for the product "Textile".
Company has approached Cost Audit Department for seeking exemption for
not conducting the Cost Audit due to declaration of company as sick
under SICA 1985.
Fixed Deposits
The Company has not accepted any deposit under Companis (Acceptance of
Deposit) Rules and other applicable provisions of the Companies Act,
1956/Companies Act, 2013 during the year and there are no outstanding
and/or overdue deposits as at 31st March, 2014.
Listing of Shares
Presently the Company shares are listed and traded at the Bombay Stock
Exchange Ltd., Mumbai (BSE) and National Stock Exchange of India,
Mumbai (NSE) and the Listing Fee has been paid till 31st March, 2015.
Directors'' Responsibility Statement
Your Directors hereby state and confirm that:
i) in preparing the Annual Accounts for the year ended 31st March 2014
all the applicable Accounting Standards have been followed,
ii) accounting policies were adopted and applied 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 31st
March 2014,
iii) proper and sufficient care for the maintenance of adequate
accounting records in accordance with the applicable provisions of the
Companies Act for safeguarding the assets of the Company and for
preventing / detecting fraud and irregularities has been taken and
iv) the Annual Accounts have been prepared on a "going concern" basis.
Particulars of Employees
Since none of the employee of the Company was getting remuneration, as
prescribed in terms of Section 217 (2A) of the Companies Act''1956 read
with the Companies (Particulars of Employees) Rules, 1975, as amended,
no particulars were required to be given herein.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
The information relating to conservation of energy, technology
absorption and foreign exchange earnings and outgo as required to be
disclosed under Section 217 (1)(e) of the Companies Act, 1956 read with
Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are given in Annexure I to the Directors''
Report.
Conclusion
Your company is presently going through financial difficulties and has
been facing many challenges due to shortage of working capital and
lacking of other financial support from its lenders. It has already
been declared as a Sick Company under Sick Industrial Companies
(Special Provisions) Act, 1985 by BIFR vide its order dated 18th
July''2012, and UCO Bank has been appointed as an Operating Agency to
work out DRS for the Company in consultation with the Company and other
lenders. It is however expected, no sooner Company gets BIFR approval
for its DRS, it would be in better position to augment its production
and sales, by utilizing its capacities optimally. In the meanwhile to
meet its day to day expenses, fixed expenses and expenses relating to
Employees/workers, it is undertaking job work from other yarn
manufacturers.
Acknowledgments
The Directors take this opportunity to express their grateful
appreciation for the whole hearted and sincere co-operation the Company
has received from the various departments of Central and State
Government, Bankers, Financial Institutions, Customers, Suppliers and
Contractors as well as Members of the Company during the year under
review of the Company. The Directors also wish to place on record their
appreciation for the contribution made by all the employees at all
levels and hope that with their continued commitment and dedication the
Company could look forward to more profitable operations ahead.
On behalf of the BOARD OF DIRECTORS,
Sd/-
Place New Delhi S P SETIA
Date: August 11, 2014 CHAIRMAN
Mar 31, 2013
The Directors have great pleasure in presenting the 21st Annual Report
together with Audited Statements of Accounts of the Company for the
year ended 31st March 2013.
Financial Results: (Rs. in Lakhs)
2012-2013 2011-2012
Net Sales (Turnover) 3,432.43 5764.75
Other Income 50.34 15.04
Financial Charges 202.36 628.50
Depreciation 454.17 462.99
Misc. Expenses written off 0 0
Profit/(Loss) before tax (PBT) (305.20) (3001.74)
Provision for Taxation 0 0
Net Profit/(Loss) (305.20) (3001.74)
FINANCIAL ANALYSIS AND PERFORMANCE REVIEW:
During the fiscal 2012-13 the turnover of the Company has decreased to
Rs. 3,432.43 lakhs as compared to Rs. 5,764.75 lakhs in the previous
year. Decline in turnover, has been primarily due to financial
constraints including shortage in working capital and lacking of other
financial support from its lenders. Consequently Company could not
utilize its entire capacities; however despite difficulties, it has
been able to reduce its net losses from Rs. 3001.74 lacs in the
previous year to Rs. 305.20 lacs during the year under review, by
handling operations efficiently and by taking job work. However, over
the period it has eroded its net worth completely and it has been
declared as a Sick Company under Sick Industrial Companies (Special
Provisions) Act''1985 by Board for industrial and financial
restructuring (BIFR) vide its order dated 18th July''2012.
Directors
Your directors have not recommended any dividend for the year ended
31-03-2013 under review.
Corporate Governance
As stipulated under Clause 49 of the Listing Agreement entered into
with Stock Exchanges, a report on Corporate Governance is attached
separately as a part of the Annual Report and the Management Discussion
and Analysis (MD & A) is included in this report so that duplication
and overlap between Directors'' Report and a separate MD & A is avoided
and the entire information is provided in a composite and comprehensive
manner.
Directors
Mr. Krishan Sankaramani retires by rotation and being eligible, offer
himself for re-appointment at the ensuing Annual General Meeting. Brief
resume of the Director to be reappointed, detailing nature of his
expertise in specific functional areas, names of companies in which he
hold directorship(s) and membership(s)/ chairmanship(s) of Board
Committees, shareholding and relationships between directors, inter-se,
as stipulated in Clause 49 of the Listing Agreement with Stock
Exchanges is provided in the Report on Corporate Governance.
Auditors
The Auditors of the Company M/s. Sunil Jain & Co., Chartered
Accountants retire at the ensuing Annual General Meeting and being
eligible offer themselves for re-appointment.
Auditors Report
The Auditors'' Report read together with the Notes to Accounts is
self-explanatory and do not call for any further explanation under
Section 217 (3) of the Companies Act, 1956, except for the responses in
respect of some observations as mentioned herein below.
Directors'' view on Auditors observations
Directors'' response to the various observations of the auditors made in
their report, has been explained wherever necessary through appropriate
notes to accounts, however pertinent notes are reproduced hereunder in
compliance with the relevant legal requirements and wherever required
further explanation is furnished:
Note No. 29 of the Financial Statement qualified by Auditors
"The Loans and Advances of the Company include a sum of
Rs.1,93,46,572, being an amount receivable from Customs Department as
drawbacks against the export sale pertaining to the period 1993 to
September, 2004 when the unit was 100% Export Oriented Unit (EOU). The
company has earlier filed an application with the office of DGFT for
the claim and made significant efforts for receiving the claim. The
Company has filed claim against Jak Traders Private Ltd. for recovery
of the claims." Company had availed the professional services of M/s
Jak Traders Pvt Ltd to assist it in realizing aforesaid claims within
the agreed time period, and had provided them advances for its
services, failing which it has become liable to refund such advances.
Since it failed to refund the same, Company has initiated legal
proceedings against M/s Jak Traders Pvt. Ltd.
Note No. 33 of the Financial Statement qualified by Auditors
"Deferred tax asset amounting to Rs.8,78,24,766 has been recognized
uptil 30th June, 2008. Afterwards, in view of brought forward losses,
the Company has decided to not recognize any further deferred tax asset
on prudence consideration."
Note No. 30 of the Financial Statement without qualifying Auditors,
have drawn attention:
"As on 31st March 2013, the accumulated losses of the Company have
exceeded its net worth. In the opinion of the management, the Company''s
operations are affected by global business downturn which has resulted
in reduction in demand, increase in input costs and shortage of working
capital. The Company has also filed a reference with Board for
Industrial and Financial Restructuring (BIFR) under Section 15 of Sick
Industrial Companies (Special Provisions) Act, 1985 for determination
of sickness and measures to be adopted for rehabilitation. The BIFR,
vide its order, declared the Company as Sick under Section 3(1)(o) of
SICA, 1985 and appointed Uco Bank as Operating Agency (OA) under
section 17(3) to prepare Rehabilitation Scheme for the Company.
Further, due to shortage of capital, the Company has worked on job-work
basis only during the current year. However, on the strength of an
undertaking from Board of Directors to turn around the financial
position of the Company, these financial statements are prepared on a
going concern basis."
Cost Auditor
The Central Government had directed for an audit of the Cost Accounts
maintained by the Company in respect of textile business. The Central
Government has approved the appointment of Shri Rajesh Goyal, Cost
Accountant of M/s. K G Goyal & Associates, Cost Accountants to conduct
the audit of the Cost Accounts of the Company for the financial year
ending 31st March, 2014 for the product "Textile".
Fixed Deposits
During the year, your Company has not accepted any deposit within the
meaning of Section 58A of the Companies Act, 1956 and the rules made
there under.
Listing of Shares
Presently the Company shares are listed and traded at the Bombay Stock
Exchange Ltd., Mumbai (BSE) and National Stock Exchange of India,
Mumbai (NSE) and the Listing Fee has been paid till 31st March, 2014.
Directors'' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, your Directors hereby state and confirm that:
i) in preparing the Annual Accounts for the year ended 31st March 2013
all the applicable Accounting Standards have been followed,
ii) accounting policies were adopted and applied 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 31st
March 2013,
iii) 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
/ detecting fraud and irregularities has been taken and
iv) the Annual Accounts have been prepared on a "going concern" basis.
Particulars of Employees
Since none of the employee of the Company was getting remuneration, as
prescribed in terms of Section 217 (2A) of the Companies Act''1956 read
with the Companies (Particulars of Employees) Rules, 1975, as amended,
no particulars were required to be given herein.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
The information relating to conservation of energy, technology
absorption and foreign exchange earnings and outgo as required to be
disclosed under
Section 217 (1)(e) of the Companies Act, 1956 read with Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 are given in Annexure I to the Directors'' Report.
Conclusion
Your company is presently going through financial difficulties and has
been facing many challenges due to shortage of working capital and
lacking of other financial support from its lenders. It has already
been declared as a Sick Company under Sick Industrial Companies
(Special Provisions) Act''1985 by BIFR vide its order dated 18th
July''2012, and UCO Bank has been appointed as an Operating Agency to
work out DRS for the Company in consultation with the Company and other
lenders. It is however expected, no sooner Company gets BIFR approval
for its DRS, it would be in better position to augment its production
and sales, by utilizing its capacities optimally. In the meanwhile to
meet its day to day expenses, fixed expenses and expenses relating to
Employees/workers, it is undertaking Job work from other yarn
manufacturers.
Acknowledgments
The Directors take this opportunity to express their grateful
appreciation for the whole hearted and sincere co-operation the Company
had received from the various departments of Central and State
Government, Bankers, Financial Institutions, Customers, Suppliers and
Contractors as well as Members of the Company during the year under
review of the Company. The Directors also wish to place on record the
appreciation for the contribution made by all the employees at all
levels and hope that with their continued commitment and dedication the
Company could look forward to more profitable operations ahead.
On behalf of the BOARD OF DIRECTORS,
Sd/-
Place New Delhi Sp SETIA
Date : May 27, 2013 CHAIRMAN
Mar 31, 2012
The Directors have great pleasure in presenting the 20th Annual Report
together with Audited Statements of Accounts of the Company for the
year ended March 31, 2012.
Financial Results: (Rs. in Lakhs)
2011-2012 2010-2011
Net Sales (Turnover) 5764.75 12549.64
Other Income 15.04 76.39
Financial Charges 628.50 761.18
Depreciation 462.99 459.48
Misc. Expenses written off 0 8.49
Profit/(Loss) before tax
(PBT) (3001.74) (22.59)
Provision for Taxation 0 0
Net Profit/(Loss) (3001.74) (22.59)
Financial Analysis and Performance Review :
During the year under review, because of sudden surge in raw material
costs, fuel prices, surplus inventories and rise in inflation, the
turnover of the Company has decreased to Rs. 5764.75 lakhs as compared
to Rs. 12549.64 lakhs in the previous year.
Directors
Mr. Suraj Prakash Setia retires by rotation and being eligible, offers
himself for re-appointment at the ensuing Annual General Meeting. Brief
resume of the Director to be reappointed, nature of their expertise in
specific functional areas, names of companies in which they hold
directorship(s) and membership(s)/ chairmanship(s) of Board Committees,
shareholding and relationships between directors, inter-se, as
stipulated in Clause 49 of the Listing Agreement with Stock Exchanges
are provided in the Report on Corporate Governance.
Auditors
The Auditors of the Company M/s. Sunil Jain & Co., Chartered
Accountants retires at the ensuing Annual General Meeting and being
eligible offer themselves for re-appointment.
Directors' view on Auditors observations
Directors' response to the various observations of the auditors even
though explained wherever necessary through appropriate notes to
accounts, is reproduced hereunder in compliance with the relevant legal
requirements.
1. The Loans and Advances of the Company include a sum of
Rs.1,93,46,572, being an amount receivable from Customs Department as
drawbacks against the export sale pertaining to the period 1993 to
September, 2004 when the unit was 100% Export Oriented Unit (EOU). The
company has filed an application with the office of DGFT for the claim
and on the basis of legal advice obtained in this regard. It is
believed claim, is genuine and the Company shall be receiving the claim
in due course.
2. Deferred tax asset amounting to Rs. 8,78,24,766 has been recognised
upto 30th June, 2008. Thereafter, in view of brought forward losses,
the Company has decided not to recognise any further deferred tax
asset.
In view of recent Government gazette notifications, Company believes
that the restoration of duty draw back and tax refunds on cotton yarn
exports would be realized in due course.
Cost Auditor
The Central Government had directed an audit of the Cost Accounts
maintained by the Company in respect of textile business. The Central
Government has approved the appointment of Shri Rajesh Goyal, Cost
Accountant of M/s. K G Goyal & Associates, Cost Accountants to conduct
the audit of the Cost Accounts of the Company for the financial year
ending 31st March, 2012 for the product "Textile".
Dividend
Your directors have not recommended any dividend for the year ended
31-03-2012 under review.
Fixed Deposits
During the year, your Company has not accepted any new deposits within
the meaning of Section 58A of the Companies Act, 1956 and the rules
made there under.
Listing of Shares
Presently the Company shares are listed and traded at the Bombay Stock
Exchange Ltd., Mumbai (BSE) and National Stock Exchange of India,
Mumbai (NSE) and the Listing Fee has been paid till 31st March, 2013.
Corporate Governance
As stipulated under Clause 49 of the Listing Agreement entered into by
the Company with Stock Exchanges, a report on Corporate Governance is
attached separately as a part of the Annual Report and Management
Discussion and Analysis (MD & A) is included in this report so that
duplication and overlapping between Directors' Report and separate MD &
A is avoided and the entire information is provided in a composite and
comprehensive manner.
Particulars of Employees
The particulars required under Section 217(1) (e) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, w.e.f. 17-4-2002 are not applicable to the Company during the
year.
Auditors Report
The Auditors' Report read together with the Notes to Accounts is self-
explanatory and do not call for any further explanation under Section
217 (3) of the Companies Act, 1956.
Directors' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, your Directors hereby state and confirm that:
i) in preparing the Annual Accounts for the year ended 31st March 2012
all the applicable Accounting Standards have been followed,
ii) accounting policies were adopted and applied 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 31st
March 2012,
iii) 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/detecting fraud and irregularities has been taken and
iv) the Annual Accounts have been prepared on a "going concern" basis.
Industrial Relations
The industrial relations during the year under review remained
harmonious and cordial. Your directors wish to place on record their
appreciation for the wholehearted co-operation received from all
employees of the Company.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
The information relating to conservation of energy, technology
absorption and foreign exchange earnings and outgo as required to be
disclosed under Section 217 (1)(e) of the Companies Act, 1956 read with
Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are given in Annexure I to the Directors'
Report.
Conclusion
Your company enjoys a leadership position in domestic market with
strong competitive advantage in export segment. The Company now looks
forward to further consolidate its position.
Acknowledgments
The Directors take this opportunity to express their grateful
appreciation for the whole hearted and sincere co-operation the Company
had received from the various departments of Central and State
Government, Bankers, Financial Institutions, Customers, Suppliers and
Contractors as well as Members of the Company during the year under
review of the Company. The Directors also wish to place on record the
appreciation for the contribution made by all the employees at all
levels and hope that with their continued commitment and dedication the
Company could look forward to more profitable operations ahead.
On behalf of the BOARD OF DIRECTORS,
S P SETIA
CHAIRMAN
Place New Delhi
Date : August 7, 2012
Mar 31, 2011
Dear Members,
The Directors have great pleasure in presenting the 19th Annual Report
together with Audited Statements of Accounts of the Company for the
year ended March 31, 2011.
Financial Results: (Rs. in Lakhs)
2010-2011 2009-2010
Net Sales (Turnover) 12549.64 7277.77
Other Income 76.39 19.50
EBIDTA 325.43
Financial Charges 761.18 754.44
Depreciation 459.48 458.32
Misc. Expenses written off 8.49 12.60
Profit/(Loss) before tax (PBT) (22.59) 899.93)
Provision for Current Tax - -
Provision for Deferred Tax - -
Fringe Benefit Tax - -
Short Provision of Tax 0.00 (0.09)
Net Profit/(Loss) (22.59) (899.84)
FINANCIAL ANALYSIS AND PERFORMANCE REVIEW :
Fiscal 2010-11 witnessed a significant improvement in operations and
there has been increase in sales volume. Its turnover has increased
from Rs. 7277.77 lakhs to Rs.12549.65 lakhs, year on year basis which
reflects an growth of 72.44%. With the improved working, it has been
able to reduce its losses considerably from 899.84 lacs during the
previous year to Rs. 22.59 Lacs during the last year.
Directors
Mr. Inder Mohan Agrawala retires by rotation and being eligible, offers
himself for re-appointment at the ensuing Annual General Meeting. Brief
resume of the Director to be reappointed, nature of his expertise in
specific functional areas, names of companies in which he hold
directorship(s) and membership(s)/ chairmanship(s) of Board Committees,
shareholding and relationships between directors, inter-se, as
stipulated in Clause 49 of the Listing Agreement with Stock Exchanges
is provided in the Report on Corporate Governance.
Auditors
The Auditors of the Company M/s. Sunil Jain & Co., Chartered
Accountants retire at the ensuing Annual General Meeting and being
eligible offer themselves for re-appointment.
Directors' view on Auditors observations
Directors' response to the various observations of the auditors even
though explained wherever necessary through appropriate notes to
accounts, is reproduced hereunder in compliance with the relevant legal
requirements.
1. Schoeller Litvinov k.s (SLKS), a fellow subsidiary of the Company,
had registered losses during the year and earlier financial years due
to economic slowdown. This fellow subsidiary had submitted a
re-organization plan dated 13-11-2009, seeking deferment of payment to
Secured Creditors, and proportionate waiver of unsecured liabilities
which has now been approved by the court. The Company believes that the
reorganization plan, considering improvement in the global textile
market, will turn around this subsidiary, so as to make good its losses
in a foreseeable period of time and will also place this subsidiary in
a position to repay the liabilities in due course. Accounts and other
receivables amounting to Rs. 6,01,84,142 are due from SLKS as at March
31, 2011. Accordingly, provision against these Accounts and other
receivables is not considered necessary at this stage.
In view of developments company believes in future with the financial
viability of SLKS such amounts would be realized within a reasonable
period of time.
2. The Loans and Advances of the Company include a sum of
Rs.1,93,46,572, being an amount receivable from Customs Department as
drawbacks against the export sale pertaining to the period 1993 to
September, 2004 when the unit was 100% Export Oriented Unit (EOU). The
company has filed an application with the office of DGFT for the claim
and on the basis of legal advise obtained, is sanguine of receiving the
claim. In view of recent Government gazette notification restoring
duty draw back , tax refunds on cotton yarn exports are expected to be
realized in due course.
3. As on March 31, 2011, the accumulated losses of the Company have
exceeded its net worth. In the opinion of the management, the Company's
operations are affected by global business downturn which has resulted
in reduction in demand, increase in input costs and shortage of working
capital. The Company has also filed a reference with Board for
Industrial and Financial Restructuring (BIFR) under section 23(1) of
Sick Industrial Companies (Special Provisions) Act, 1985. However,
based on recent performance and trends of the company and overall
industry outlook, there is an increase in average selling prices of
yarn, stability in production levels and reduction in procurement costs
of raw materials. The company has started earning cash profits and the
management believes that losses incurred in past would be made good.
The financial statements have been prepared on a going concern basis on
the strength of management's plan of revival including reorganization
of business and restructuring of loan facilities under Corporate Debt
Restructuring scheme.
in view of current physical turnover, management believes to improve
the company's performance such as introducing various cost measures and
reorganization of business and restructuring of loan facilities.
Cost Auditor
The Central Government had directed an audit of the Cost Accounts
maintained by the Company in respect of textile business. The Central
Government has approved the appointment of Shri Rajesh Goyal, Cost
Accountant of M/s. K G Goyal & Associates, Cost Accountants to conduct
the audit of the Cost Accounts of the Company for the financial year
ending 31st March, 2011 for the product "TextileÃ.
Dividend
Your directors have not recommended any dividend for the year ended
31-03-2011 under review.
Fixed Deposits
During the year, your Company has not accepted any new deposits within
the meaning of Section 58A of the Companies Act, 1956 and the rules
made there under.
Listing of Shares
Presently the Company shares are listed and traded at the Bombay Stock
Exchange Ltd., Mumbai (BSE) and National Stock Exchange of India,
Mumbai (NSE) and the Listing Fee has been paid till 31st March, 2012.
Corporate Governance
As stipulated under Clause 49 of the Listing Agreement entered into
with Stock Exchanges, a report on Corporate Governance is attached
separately as a part of the Annual Report and the Management Discussion
and Analysis (MD & A) is included in this report so that duplication
and overlap between Directors' Report and a separate MD & A is avoided
and the entire information is provided in a composite and comprehensive
manner.
Particulars of Employees
The particulars required under Section 217(1) (e) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, w.e.f. 17-4-2002 are not applicable to the Company during the
year.
Auditors Report
The Auditors' Report read together with the Notes to Accounts is self-
explanatory and do not call for any further explanation under Section
217 (3) of the Companies Act, 1956.
Directors' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, your Directors hereby state and confirm that:
i) in preparing the Annual Accounts for the year ended 31st March 2011
all the applicable Accounting Standards have been followed,
ii) accounting policies were adopted and applied 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 31st
March 2011,
iii) 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
/ detecting fraud and irregularities has been taken and
iv) the Annual Accounts have been prepared on a "going concern" basis
Industrial Relations
The industrial relations during the year under review remained
harmonious and cordial. Your directors wish to place on record their
appreciation for the wholehearted co-operation received from all
employees at unit of the Company.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
The information relating to conservation of energy, technology
absorption and foreign exchange earnings and outgo as required to be
disclosed under Section 217 (1)(e) of the Companies Act, 1956 read with
Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are given in Annexure I to the Directors'
Report.
Conclusion
Your company enjoys a leadership position in domestic market with
strong competitive advantage in export segment. The Company now stands
at the cusp of the next phase of growth. We will continue to make
investment and progress to further consolidate our leadership position.
Acknowledgments
The Directors take this opportunity to express their grateful
appreciation for the whole hearted and sincere co-operation the Company
had received from the various departments of Central and State
Government, Bankers, Financial Institutions, Customers, Suppliers and
Contractors as well as Members of the Company during the year under
review of the Company. The Directors also wish to place on record the
appreciation for the contribution made by all the employees at all
levels and hope that with their continued commitment and dedication the
Company could look forward to more profitable operations ahead.
On behalf of the BOARD OF DIRECTORS,
Place New Delhi S P SETIA
Date : August 8, 2011 CHAIRMAN
Mar 31, 2010
The Directors have great pleasure in presenting the 18th Annual Report
together with Audited Statements of Accounts of the Company for the
year ended March 31, 2010.
Financial Results: (Rs. in Lakhs)
2009-2010 2008-2009
Net Sales (Turnover) 7277.77 3076.84
Other Income 19.50 367.67
EBIDTA 325.43 (260.94)
Financial Charges 754.44 694.69
Depreciation 458.32 503.08
Misc. Expenses written off 12.60 12.60
Profit/(Loss) before tax (PBT) (899.93) (1471.31)
Provision for Current Tax - -
Provision for Deferred Tax - (49.49)
Fringe Benefit Tax - 1.30
Short Provision of Tax (0.09) 6.89
Net Profit/(Loss) (899.84) (1430.01)
MANAGEMENT DISCUSSION AND ANALYSIS
Global economy has shown slight recovery after the steep slowdown since
2008. The global economy is expected to grow by 4.2% in 2010 and
projected to maintain growth in the coming years also. However the
economy growth is depending upon demand in America and European
Countries whose economy is showing convincing revival. There was
tremendous relief to Indian industries over rescue packages introduced
by the Indian government, the exports since November, 2009 showing
sustainable recovery in spite of inflation, currency appreciation and
uncertainty over sub normal monsoon.
The Indian Textile Industry plays very important role in our Countrys
Economy and earliest to come into existence in India, it accounts for
14 per cent of the total industrial production, contributes to nearly
12 per cent of the total exports and is the second largest employment
generator after agriculture providing employment of 35 million people.
The Indian textile industry is one of the largest in the world with a
massive raw material and textile-manufacturing base and also currently
India has the second highest spindleage in the world after China.
Indian economy is largely dependent on the textile manufacturing and
trade in addition to other major industries about 30 per cent of the
exchange earning are on account of export of textiles and clothing
alone.
Demand in America and European countries and in domestic market, the
yarn production expecting to grow utpo 8% in 2011 in Indian Economy.
However, increase in input prices, rupee appreciation and withdrawal of
refund on export cotton yarn may give negative impact on growth of
textile exports.
Amit has utilized the opportunity offered by the global recession for
introspection to identify areas of improvement. It is a great
satisfaction that such initiatives have paid us more and strengthened
the company accordingly expecting such events in future also. Amit is
expecting bright future for Indian textile industry.
FINANCIAL ANALYSIS AND PERFORMANCE REVIEW :
Fiscal 2009-10 witnessed a significant improvement to increase in sales
volume. The management with help of banks provided surplus cash flow
for purchase of raw cotton, the Company has achieved impressive
results, the turnover has been increased from Rs. 3444.52 lakhs to Rs.
7297.27 lakhs which reflects an growth of 111.85%
SEGMENT-WISE PERFORMANCE
Amit Spinning Industries Ltd. (ASIL) being a cotton yarn manufacturer
has only one business segment. On the basis of geographical
categorization of market, ASIL identified two segments i.e. exports and
domestic.
INTERNAL CONTROL SYSTEMS AND ADEQUACY
The Company has established adequate internal control systems,
commensurate with its size and nature of business and such systems are
periodically audited, verified and reviewed for their validity,
considering the changing business scenario from time to time. The Audit
Committee of the Board of Directors reviews the adequacy and
effectiveness of internal control systems and suggests improvement for
strengthening them from time to time.
MANAGEMENT PERCEPTION ON OPPORTUNITIES, RISKS, CONCERN & OUTLOOK
India has rich resources of raw materials of textile industry and is
one of the largest producers of cotton in the world. India is highly
competitive in spinning sector and has presence in almost all processes
of the value chain. In the recent past the Government also from time to
time announces various policy measures to boost growth of the textile
industry, The Indian textile industry is expected to pick-up and saw a
strong growth in 2010. Moreover China themselves admit that their
industry has lost the competitive edge in the last one year. With the
rising demands from US and EU markets, the Indian Textile Industry have
better prospects in the coming years.
Indian textile industry is highly fragmented in industry structure, and
is led by small scale companies. The reservation of production for very
small companies that was imposed with the intention to help out small
scale companies across the country, led substantial fragmentation that
distorted the competitiveness of industry. Smaller companies do not
have the fiscal resources to enhance technology or invest in the high-
end engineering of processes. Hence they lose in productivity. Despite
various stimulus packages introduced by the Government, the textile
industry has lost the competitive edge in the past one year with
petroleum products & labour became costly, ultimately affecting the
margins of the Indian textile industry which is also major concern for
the growth of the industry.
The outlook for textile industry in India is very optimistic. It is
expected that Indian textile industry would continue to grow at an
impressive rate. Textile industry is being modernized by an exclusive
scheme, which has set aside $5bn for investment in improvisation of
machinery. India can also grab opportunities in the export market. The
textile industry is anticipated to generate 12mn new jobs in various
sectors more comfortability, the management is in process to extend its
operations in Technical Textile to play role in both domestic as well
as export market.
HUMAN RESOURCES/INDUSTRIAL RELATIONS
It is needless to state that the success of an organization mainly
depends on the human capital employed by them. The Company strives to
provide opportunities and an environment, coupled with education and
training to its employees enabling them to contribute to their fullest
extent and develop their career with the growth of the organization.
Directors
Mr. Ranjan Mangtani and Mr. R Sampath retires by rotation and being
eligible, offers themselves for re-appointment at the ensuing Annual
General Meeting. Brief resume of the Directors to be reappointed,
nature of their expertise in specific functional areas, names of
companies in which they hold directorship(s) and membership(s)/
chairmanship(s) of Board Committees, shareholding and relationships
between directors, inter-se, as stipulated in Clause 49 of the Listing
Agreement with Stock Exchanges are provided in the Report on Corporate
Governance.
Auditors
The Auditors of the Company M/s. Sunil Jain & Co., Chartered
Accountants retires at the ensuing Annual General Meeting and being
eligible offer themselves for re-appointment.
Cost Auditor
The Central Government had directed an audit of the Cost Accounts
maintained by the Company in respect of textile business. The Central
Government has approved the appointment of Shri Rajesh Goyal, Cost
Accountant of M/s. K G Goyal & Associates, Cost Accountants to conduct
the audit of the Cost Accounts of the Company for the financial year
ending 31st March, 2010 for the product ÃTextileÃ.
Dividend
Your directors have not recommended any dividend for the year ended
31-03-2010 under review.
Fixed Deposits
During the year, your Company has not accepted any new deposits within
the meaning of Section 58A of the Companies Act, 1956 and the rules
made there under.
Listing of Shares
Presently the Company shares are listed and traded at the Bombay Stock
Exchange Ltd., Mumbai (BSE) and National Stock Exchange of India,
Mumbai (NSE) and the Listing Fee has been paid till 31st March, 2011.
Corporate Governance
As stipulated under Clause 49 of the Listing Agreement entered into
with Stock Exchanges, a report on Corporate Governance is attached
separately as a part of the Annual Report and the Management Discussion
and Analysis (MD & A) is included in this report so that duplication
and overlap between Directors Report and a separate MD & A is avoided
and the entire information is provided in a composite and comprehensive
manner.
Particulars of Employees
The particulars required under Section 217(1) (e) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, w.e.f. 17-4-2002 are not applicable to the Company during the
year.
Auditors Report
The Auditors Report read together with the Notes to Accounts is
self-explanatory and do not call for any further explanation under
Section 217 (3) of the Companies Act, 1956.
Directors Responsibility Statement
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directors Responsibility Statement, it is
hereby confirmed that:
a) in the preparation of the Annual Accounts, the applicable accounting
standards have been followed along with proper explanations relating to
material departures;
b) the Directors have selected such accounting policies and applied
them consistently and made judgment 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 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
your Company and for preventing and detecting fraud and other
irregularities; and
d) the Directors have prepared the annual accounts on a going concern
basis.
Industrial Relations
The industrial relations during the year under review remained
harmonious and cordial. Your directors wish to place on record their
appreciation for the wholehearted co-operation received from all
employees at unit of the Company.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
The information relating to conservation of energy, technology
absorption and foreign exchange earnings and outgo as required to be
disclosed under Section 217 (1)(e) of the Companies Act, 1956 read with
Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are given in Annexure I to the Directors
Report.
Conclusion
Your company enjoys a leadership position in domestic market with
strong competitive advantage in export segment. The Company now stands
at the cusp of the next phase of growth. We will continue to make
investment and progress to further consolidate our leadership position.
Acknowledgments
The Directors take this opportunity to express their grateful
appreciation for the whole hearted and sincere co-operation the Company
had received from the various departments of Central and State
Government, Bankers, Financial Institutions, Customers, Suppliers and
Contractors as well as Members of the Company during the year under
review of the Company. The Directors also wish to place on record the
appreciation for the contribution made by all the employees at all
levels and hope that with their continued commitment and dedication the
Company could look forward to more profitable operations ahead.
On behalf of the BOARD OF DIRECTORS,
Place New Delhi S P SETIA
Date : August 9, 2010 CHAIRMAN
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article