Mar 31, 2014
Dear Shareholders,
We have pleasure in presenting the 17th Annual Report of the Company
and the audited statement of accounts for the year ended 31st March,
2014. A summary of the financial results is given below.
FINANCIAL RESULTS
(''000) (''000)
Year ended Year ended
on On
31/03/2014 31/03/2013
Gross sales including other income 1,76,947 1,70,598
Gross Profit (Loss) 63.871 53,791
Depreciation 18.744 37,619
Profit/Loss for the year 45,127 20,817
MANAGEMENT DISCUSSION AND ANALYSIS
Textile industry plays a pivotal role in India''s economy. It
contributes 14% to India''s industrial production, 4% to the GDP and 17%
to export earnings. It provides employment to 35 million people.
Recognizing such a pivotal role the Government has been taking many a
steps to minimize the effect of economic slowdown faced by the industry
during the year under reference.
You are aware that in spite of acute financial crisis your Company has
been able to sustain its operations to avoid damage to plant and
machinery. The Company has settled the accounts of all the three banks,
namely IDBI Bank, Bank of Baroda and UCO Bank. The dues of IDBI Bank
and Bank of Baroda have been assigned to M/s. U V Asset Reconstruction
Company Limited and the dues of UCO bank have been taken over by M/s.
ASREC (India) Ltd. The borrowings from Asset Reconstruction Companies
(ARCs) are at higher cost and at best can be used only as a temporary
means of finance.
Market conditions for cotton textiles have not been conducive during
2013-14. On account of general economic slowdown and lower GDP, the
markets have been sluggish. As we have been working with heavy
constraints, our operations did not yield positive results. The
settlement of UCO Bank account has resulted in write back of part loans
and interest and is reflected in the accounts.
Your Company also attracts provisions of Section 23 (1) (a) (i) of The
Sick Industrial Companies Act, 1985 due to erosion of Net worth.
MANAGEMENT PERCEPTION OF RISK AND CONCERN
1. Agriculture in India is still dependent on rains for irrigation As
agriculture contributes substantially to our GDP, any downfall in agri
production affects economy. Monsoon this year has not been up to the
mark and large areas particularly in cotton growing regions have not
received adequate rains. It will have its impact not only on quality of
cotton but also on its prices during the current year. Consumption of
manmade fibres is still low in our country as compared to global
standards.
2. China has been a major buyer for Indian textiles - yarn and fabrics.
This year China is reported to have decided to reduce import of
textiles to encourage domestic production and this decision is showing
its impact on the industry
3. However, your Company is taking all possible steps to augment its
production levels irrespective of general economic conditions.
INTERNAL CONTROL SYSTEM
Your Company has developed a well defined internal control system over
a period which meets its requirement. The system is reviewed
periodically to keep with the times and ensure optimal utilization and
protection of company''s resources. Audit Committee of the Board
monitors the internal control system.
HUMAN RESOURCES/INDUSTRIAL RELATIONS
Your Company encourages innovation and performance. It appreciates and
values the Human asset of the Company. In spite of difficult situation
on operational front, the morale of employees is high and they have
been working hard to turn the tide in favour of better working of your
Company. The Company has developed an environment of harmonious and
cordial relations with its employees.
As the Company is in Textile business only, segment reporting is not
required.
DIVIDEND
No dividend is being recommended for the year under review in view of
the accumulated losses. DIRECTORS'' RESPONSIBILITY STATEMENT
On the basis of compliance certificates received from the concerned
executives of the Company and subject to disclosures in the annual
accounts, as also on the basis of the discussion with the Statutory
Auditors of the Company from time to time, as required under Section
217(2AA) of the Companies Act 1956, the Directors hereby confirm that:
i) in the preparation of the annual accounts, the applicable accounting
standards have been
followed along with proper explanation relating to material departures;
ii) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the Profit of
the Company for that period ;
iii) the Directors have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other
irregularities, if any ;
iv) the Directors have prepared the annual accounts on a going concern
basis.
DIRECTORS
Mr.Akash B. Shah, Director, retires by rotation and being eligible, has
offered himself for re-appointment.
The Board at its meeting held on 04.09.2014 recommended appointment of
Mrs. Shakuntala Vyas, as non executive, non-independent Director of the
Company whose period of office is liable to determination by retirement
of directors by rotation and in respect of whom the Company has
received a notice in writing from a member proposing her candidature
for the office of Director.
The Board recommends the resolutions for your approval for the above
appointments.
OTHER INFORMATION Auditors
M/s G. Dutta & Co., Chartered Accountants, (ICAI Registration No.
002136 ''C'') who are Statutory Auditors of the Company will hold office
till the conclusion of the ensuing Annual General Meeting and are
recommended for re-appointment to audit the accounts of the Company for
the Financial Year 2014-15. As required under the provisions of Section
139 of the Companies Act, 2013 the Company has obtained written
confirmation from M/s G. Dutta & Co., Chartered Accountants, that their
appointment, if made, would be in conformity with the limits specified
in the said Section.
The observations made by the Auditors in their Report are adequately
explained in the notes to the Accounts and significant Accounting
Policies and need no further elaboration.
Cost Auditor & Cost Audit Report
During the year, Pursuant to the directives of the Central Government
under the provisions of Section 233B of the Companies Act, 1956, read
with The Companies (Cost Accounting Records) Rules, 2011 Board
appointed, Mr. Pawan Gupta & associates, Cost Auditor to conduct cost
audits relating to textile products manufactured by the Company.
Information as per section 217 (2A) of the Companies Act, 1956 read
with the Companies (Particulars of Employees) Rules, 1975:
None of the employee was in receipt of remuneration in excess of limit
prescribed under Section 217 (2A) of the Companies Act, 1956.
Energy Conservation, Technology Absorption & Foreign Exchange
A statement giving details of conservation of energy, technology
absorption, foreign exchange earnings and outgo, in accordance with the
Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 is annexed and marked Annexure ''A'' and forms
part of this Report
CORPORATE GOVERNANCE
A separate report on Corporate Governance is enclosed as a part of this
Annual Report. A certificate from the Auditors of the Company regarding
compliance with Corporate Governance norms stipulated under Clause 49
of the Listing Agreement is annexed to the Report on Corporate
Governance.
CASH FLOW ANALYSIS
In conformity with the provisions of clause 32 of the Listing Agreement
the Cash Flow Statement for the year ended 31.03.2014 is annexed
hereto.
ACKNOWLEDGEMENT
The Board acknowledges with deep sense of gratitude for the valuable
assistance and cooperation extended and guidance provided by Government
Authorities, Banks, financial institutions, Business associates and
looks forward for their continued support. Your Directors are also
grateful to the customers & suppliers for their trust and support. Your
Directors would like to appreciate dedication and hard work put in by
every employee of your company. Last but not the least, your Directors
are deeply grateful for the confidence and faith shown by the members
of the Company in them.
For and on behalf of the Board,
Sd/- Sd/-
S.K.Singhal S.G.Vyas
Director Managing Director
(DIN-00075934) (DIN-01905310)
Jaipur
04.09.2014
Mar 31, 2013
The Directors present the 16th Annual Report together with Audited
Accounts for the year ended 31st March, 2013.
FINANCIAL RESULTS
(Rs.000) (Rs.000)
Year ended Year ended
On On
31/03/2013 31/03/2012
Gross sales including other income 1,70,598 1,06,556
Gross Profit(Loss) 53,791 (87,478)
Depreciation 37,619 33,962
Profit/Loss for the year 20,817 (1,21,440)
MANAGEMENT DISCUSSION AND ANALYSIS
You are aware that for quite some time your Company has been facing
acute shortage of working capital which coupled with cumulative losses
has seriously affected its operations. In the year 2011-12 your Company
settled the Loan account of IDBI Bank and during 2012-13 the Loan
accounts of Bank of Baroda have been settled through Assignment of Debt
to an Asset Reconstruction Company. Now only UCO Bank account needs to
be sorted out for which efforts are going on. Once this is settled,
your Company would be in normal operational position. Your Company has
created state of art manufacturing facilities which have helped
overcome the difficult situation on operational front. The settlement
of Bank of Baroda account has resulted in write back of part loans and
interest and is reflected in the accounts.
Your Company also attracts provisions of Section 23 (1) (a) (i) of The
Sick Industrial Companies Act, 1985 due to erosion of Net worth. The
company has incurred loss due to poor utilization of facilities on
account of paucity of working capital as also substantial investment in
assets which could not be operationalised namely ring Spinning Section.
The interest cost of such non operational investment and consequent
losses due to inadequacy of working capital has caused the loss of Net
Worth.
MANAGEMENT PERCEPTION OF RISK AND CONCERN
1. Govt, policy of intervention in cotton price mechanism and export
incentive system affects Textile industry in a big way. Volatile value
of national currency also affects import and export decisions. Indian
economy witnessed inflationary trends during 2012-13.
2. With the general economic slowdown in India and many other
countries, textile industry in India faced twin hurdles of lower demand
and higher costs. The euphoria of fast economic growth in India seems
vanishing. Though the Govt, is aware of these developments and is
trying to address the issues, it has not been able to make a big
impact.
3. However, your Company is making all out efforts to keep the wheels
of industry moving and settle the matter with the last one bank
amicably.
INTERNAL CONTROL SYSTEM
Commensurate to the size and nature of its business your Company has
developed a well defined internal control system. The Company takes
abundant care to design, review and monitor the working of internal
control system for optimal utilization and protection of resources. All
significant issues are brought to the attention of the Audit Committee
of the Board.
HUMAN RESOURCES/INDUSTRIAL RELATIONS
Though your Company is facing a difficult situation, its employees have
high morale and remain motivated to steer it through. Performance
management is the key word for the Company. The Company has developed
an environment of harmonious and cordial relations with its employees.
As the Company is in Textile business only, segment reporting is not
required.
DIVIDEND
No dividend is being recommended for the year under review in view of
the losses.
DIRECTORS'' RESPONSIBILITY STATEMENT
As required under Section 217(2 AA) of the Companies Act, the Directors
hereby confirm that:
i) in the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
ii) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the Profit of
the Company for that period;
iii) the Directors have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other
irregularities;
iv) the Directors have prepared the annual accounts on a going concern
basis.
DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company Mr. N.K. Khurana, Director of
the Company retire by rotation and being eligible, offer himself for
re-appointment.
OTHER INFORMATION
Information as per section 217 (2A) of the Companies Act, 1956 read
with the Companies (Particulars of Employees) Rules, 1975:
None of the employee was in receipt of remuneration in excess of limit
prescribed under Section 217 (2A) of the Companies Act, 1956.
Energy Conservation, Technology Absorption & Foreign Exchange
The information required under Section 217(1) (e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the report
of Board of Director(s) Rules, 1988 with respect to Conservation of
energy, technology absorption and foreign exchange eamings/outgo is
appended hereto and form part of this report.
AUDITORS
M/s G. Dutta & Co., Chartered Accountants, Auditors of the Company
retire and being eligible offers themselves for re-appointment.
The observations made by the Auditors in their Report are adequately
explained in the notes to the Accounts and significant Accounting
Policies and need no further elaboration.
CORPORATE GOVERNANCE
As per Clause 49 of the listing agreement with the Stock Exchange, a
separate section on Corporate
Governance forms part of the Annual Report.
A Certificate from the Auditors of the Company confirming compliance
with conditions of Corporate
Governance as stipulated under the Clause 49 of the listing agreement
is annexed to this Report.
ACKNOWLEDGEMENT
The Board acknowledges the valuable assistance and cooperation received
from Government Authorities and Business associates and looks forward
to their continued support.
Your Directors express their deep appreciation for the commitment and
hard work put in by all employees.
For and on behalf of the Board
Sd/-
(S.G.VYAS)
MANAGING DIRECTOR
Place: Jaipur
Dated: 25.08.2013
Mar 31, 2012
Dear Members,
The Directors present the 15th Annual Report together with Audited
Accounts for the year ended 31st March, 2012.
FINANCIAL RESULTS
(Rs.''000) (Rs.''000)
Year ended Year ended
On On
31/03/2012 31/03/2011
Gross sales including other income 1,06,556 1,12,542
Gross Loss 87,478 87,520
Depreciation 33,962 34,124
Loss for the year 1,21,440 1,21,644
DIVIDEND
No dividend is being recommended for the year under review in view
ofthe losses.
DIRECTORS'' RESPONSIBILITY STATEMENT
As required under Section 217(2AA) ofthe Companies Act, the Directors
hereby confirm that:
i) in the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
ii) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the Loss ofthe
Company for that period ;
iii) the Directors have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other
irregularities;
iv) the Directors have prepared the annual accounts on a going concern
basis.
DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company Mr. S.G. Vyas and Mr.
S.K.Singhal, Directors of the Company retire by rotation and being
eligible, offer themselves for re-appointment. Mr. R.N.Swami was
appointed as Additional Director w.e.f. 19.03.2012. Mr. Swami is not
seeking re appointment due to other commitments.
OTHER INFORMATION
Information as per section 217 (2A) of the Companies Act, 1956 read
with the Companies (Particulars of Employees) Rules, 1975:
None of the employee was in receipt of remuneration in excess of limit
prescribed under Section 217 (2A) of the Companies Act, 1956.
Energy Conservation, Technology Absorption & Foreign Exchange
The information required under Section 217(1) (e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the report
of Board of Directors) Rules, 1988 with respect to Conservation of
energy, technology absorption and foreign exchange earnings/outgo is
appended hereto and form part of this report.
AUDITORS
M/s G. Dutta & Co., Chartered Accountants, Auditors of the Company
retire and being eligible offers themselves for re-appointment.
The observations made by the Auditors in their Report are adequately
explained in the notes to the Accounts and significant Accounting
Policies and need no further elaboration.
CORPORATE GOVERNANCE
As per Clause 49 of the listing agreement with the Stock Exchange, a
separate section on Corporate Governance forms part of the Annual
Report.
A Certificate from the Auditors of the Company confirming compliance
with conditions of Corporate Governance as stipulated under the Clause
49 ofthe listing agreement is annexed to this Report.
ACKNOWLEDGEMENT
The Board acknowledges the valuable assistance and cooperation received
from Government Authorities and Business Constituents and looks forward
to their continued support.
Your Directors express their deep appreciation for the commitment and
hard work put in by all employees.
For and on behalf of the Board
Place: Jaipur (S.G.VYAS)
28.09.2012 MANAGING DIRECTOR
Mar 31, 2010
The Directors present the 13th Annual Report together with Audited
Accounts for the year ended 31st March, 2010.
FINANCIAL RESULTS
(Rs.000) (Rs.000)
Year ended On Year ended On
31/03/2010 31/03/2009
Gross sales including other income 1,58,264 3,91,843
Gross Loss 1,27,494 11,288
Depreciation 34,353 34,190
Loss before tax 1,61,847 45,478
Provision for Tax - 81
Loss after tax 1,61,847 45,559
MANAGEMENT DISCUSSION AND ANALYSIS
The year 2008-09 was a difficult year for global economy due to severe
recessionary trends resulting in economic crisis. However, things
started looking up during 2009-10 in a cautious manner. Due to large
domestic market, recovery in Indian economy has been faster than many
developed economies. Textile industry has also shown signs of
improvement. Investments made in earlier years, particularly under TUF
scheme, have started showing results in terms of volume and quality.
Increased manufacturing of textile products has also increased domestic
competition particularly on account of shrinkage in overseas demand.
Further the industry is facing substantial increase in input costs
which is difficult to pass on to the consumers in short run. Government
policy of withdrawal of export promotion benefits have also caused
concern and slowed the sustained recovery.
Your Company has created world class weaving facilities but the same
could not be utilized optimally due to paucity of working capital. The
adverse economic conditions of earlier year caused loss to your Company
and consequent erosion of working capital. Shortage of funds has
compelled the Company to partly withhold the implementation of
expansion project. Moreover, your Company had to repay part of its term
loan even before the commissioning of expansion project. This led to
severe shortage of funds. Companys request to the banks for
restructuring of debt and extending further facilities has not evoked
positive response so far. This has seriously hampered the working of
your Company resulting in lower capacity utilization and consequent
operational loss.
However, our faith in Indias textiles industry remains unshaken and we
foresee a bright future for Indian textiles. Present global trends show
a healthy improvement in demand for textiles from India.
MANAGEMENT PERCEPTION OFR1SKANDCONCERN
1. Textile industry is highly competitive not only for domestic market
but for global trade as well. In such a scenario appreciating rupee
value vis a vis U S Dollar has significant effect on our earnings.
2. With the globalization of Indian economy, cotton prices have gone
up in tandem with global trends. Massive increase in Minimum Support
Price of cotton by Central Govt, and uncaliberated export of this raw
material has further added to the difficulties of textile industry. An
integrated view need to be taken by the authorities in this regard for
safeguarding the interest of industry.
3. Your Management is making all out efforts to improve productivity,
control costs and produce better fabrics and yarn to fetch higher unit
realization.
INTERNAL CONTROL SYSTEM
The Company has well defined internal control system commensurate to
the size and nature of its business. The Company takes abundant care to
design, review and monitor the working of internal control system for
optimal utilization and protection of resources. All significant issues
are brought to the attention of the Audit Committee of the Board.
HUMAN RESOURCES/1NDUSTRIALRELATIONS
Your Company lays emphasis on building and sustaining an excellent
organization climate based on human performance. Performance management
is the key word for the Company. The Company has developed an
environment of harmonious and cordial relations with its employees. As
the Company is in Textile business only, segment reporting is not
required.
DIVIDEND
No dividend is being recommended for the year under review in view of
the losses.
DIRECTORSRESPONSIBILITY STATEMENT
As required under Section 217(2 A A) of the Companies Act, the
Directors hereby confirm that: i) in the preparation of the annual
accounts, the applicable accounting standards have been followed along
with proper explanation relating to material departures;
ii) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the Loss of the
Company for that period;
iii) the Directors have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other
irregularities;
iv) the Directors have prepared the annual accounts on a going concern
basis.
DIRECTORS
There was no change in composition of Board during 2009-10.
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company Mr. N K Khurana and Mrs.
Shakuntala Vyas, Directors of the Company retire by rotation and being
eligible, offer themselves for re-appointment.
OTHER INFORMATION
Information as per section 217 (2A) of the Companies Act, 1956 read
with the Companies (Particulars of Employees) Rules, 1975:
None of the employee was in receipt of remuneration in excess of limit
prescribed under Section 217 (2A) of the Companies Act, 1956.
Energy Conservation, Technology Absorption & Foreign Exchange
The information required under Section 217( 1) (e) of the Companies
Act, 1956 read with the Companies (Disclosure of Particulars in the
report of Board of Directors) Rules, 1988 with respect to Conservation
of energy, technology absorption and foreign exchange earnings/outgo is
appended hereto and form part of th is report.
AUDITORS
M/s G. Dutta & Co., Chartered Accountants, Auditors of the Company
retire and being eligible offers^themselves for re-appointment.
The observations made by the Auditors in their Report are adequately
explained in the notes to the Accounts and significant Accounting
Policies and need no further elaboration.
CORPORATE GOVERNANCE
As per Clause 49 of the listing agreement with the Stock Exchange, a
separate section on Corporate Governance forms part of the Annual
Report.
A Certificate from the Auditors of the Company confirming compliance
with conditions Of Corporate Governance as stipulated under the Clause
49 of the listing agreement is annexed to this Report.
ACKNOWLEDGMENT
The Board acknowledges the valuable assistance and cooperation received
from Government Authorities, Bankers and Business Constituents and
looks forward to their continued support.
Your Directors express their deep appreciation for the commitment and
hard work put in by all employees.
For and on behalf of the Board
(S.G.VYAS)
MANAGING DIRECTOR
Place: Jaipur
Dated: 27.08.10