Directors Report of Omkar Speciality Chemicals Ltd.
Mar 31, 2015
TO THE MEMBERS OMKAR SPECIALITY CHEMICALS LIMITED
The Directors have pleasure in presenting their Tenth Annual Report
and Audited Financial Statements for the Financial Year ended on 31st
March, 2015. Consolidated performance of the Company and its
subsidiaries has been referred to wherever required.
FINANCIAL HIGHLIGHTS:
The financial performance of the Company for the Financial Year ended
31st March, 2015 is summarized below:
(Rs. in Lakhs)
Particulars Standalone Financial Perfo Consolidated Financial Perfor
mance mance
Year ended year ended year ended year ended
31st March, 31st March, 31st March, 31st March
2015 2014 2015 2014
INCOME
Revenue from
Operation 19,331.31 20,962.11 26,513.37 24,027.98
Other Income 491.02 574.73 89.75 324.78
TOTAL REvENuE 19,822.33 21,536.84 26,603.12 24,352.76
expenditure
Cost of Material
Consumed 10,364.19 9,354.11 13,804.31 11,213.37
Purchase of
Stock in Trade 2,389.33 5,079.46 3,296.30 5,079.46
Changes in
Inventories 674.25 283.38 (328.14) (178.77)
Employee Benefits
Expense 1,018.33 988.25 1,434.88 1,392.66
Finance Costs 1,142.80 1,174.63 1,448.35 1,435.73
Depreciation &
Amortization Expense 197.36 610.16 1,032.68 1,205.90
Other Expenses 1,991.13 1,967.18 3,089.25 2,227.28
TOTAL EXPENDITURE 17,777.39 19,457.17 23,777.63 22,375.63
Profit before
Exceptional Items & 2,044.94 2,079.67 2,825.49 1,977.13
Extraordinary Items
and Tax
Exceptional Items
& Extraordinary Items - 6.60 - 6.60
profit before TAX 2,044.94 2,073.07 2,825.49 1,970.53
Tax Expenses 251.48 612.85 397.40 614.47
PROFIT AFTER TAX 1,793.46 1,460.22 2,428.09 1,356.06
Balance in Profit
& Loss Account
brought 4,753.28 3,737.52 4,583.87 3,672.27
forward from
previous year
Less: Appropriations
Proposed Dividend 308.67 294.42 308.67 294.42
Tax on Dividend 52.46 50.04 52.46 50.04
Transfer to
General Reserve 150.00 100.00 150.00 100.00
Balance carried to
Balance Sheet 6,035.61 4,753.28 6,500.83 4,583.87
PERFORMANCE REVIEW:
During the year under review, the Company has reported a healthy
increase in the consolidated net profit by 79.06% to Rs. 2,428.09 lacs,
as compared to Rs. 1,356.06 lacs in the previous year. The total
consolidated income for current financial year stood at Rs. 26,513.37
lacs as compare to Rs. 24,027.98 lacs in the previous year, recording a
rise of 10.35%.
On the standalone basis, the Company's performance in the current
financial year, in terms of total income stood at 19,331.31 lacs as
compare to Rs. 20,962.11 lacs in the previous year. Despite of slight
downfall in the topline, the net profit recorded during the current
financial year on standalone basis is Rs. 1,793.46 lacs as compare to
Rs. 1,460.22 lacs in the previous year reporting a rise of 23%.
SHARE CAPITAL:
During the Financial Year 2014-15, pursuant to the provisions of the
Companies Act, 1956, Companies Act, 2013, based on the approval granted
by the shareholders of the Company, The BSE and National Stock Exchange
of India Limited (Stock Exchanges) and as per the relevant provisions
of the Memorandum and Articles of Association of the Company, the Board
of Directors at their meeting held on 30th August, 2014, approved,
issued and allotted 9,50,000 equity shares of Rs. 10/- each at a
premium of Rs. 140/- per share towards conversion of warrants issued
and subscribed by the Promoters and Promoter Group of the Company.
Consequently, the paid up capital of the Company was increased from
1,96,28,004 equity shares of Rs. 10/- each amounting to Rs.
19,62,80,040/- to 2,05,78,004 equity shares of Rs. 10/- each amounting
to Rs. 20,57,80,040/-.
The Authorised Capital of the Company was increased from 2,50,00,000
equity shares of Rs. 10/- each amounting to Rs. 25 cr. to 3,50,00,000
equity shares of Rs. 10/- each amounting to Rs. 35 cr. pursuant to the
approval of members granted by Postal Ballot vide results of the Postal
Ballot declared on 24th December, 2014.
DIVIDEND:
Based on the Company's performance, the Directors are pleased to
recommend for the approval of members a dividend of Rs. 1.50 per share
(previous year Rs. 1.50 per share) on the capital of 2,05,78,004 Equity
Shares of Rs. 10/- each. The dividend on equity shares as recommended
above, if approved by the members would involve cash outflow of Rs.
361.13 lacs including dividend distribution tax of Rs. 52.46 lacs
[Previous years Rs. 344.46 lacs including dividend distribution tax of
Rs. 50.04 lacs].
TRANSFER TO RESERVES:
Your Company proposes to transfer Rs. 150 Lakhs to General Reserve out
of the amount available for appropriations and an amount of Rs.
6,035.61 Lakhs is proposed to be retained in the Profit and Loss A/c.
UNPAID DIVIDEND:
As per the information obtained from Axis Bank Ltd and HDFC Bank Ltd.,
it has been noted that the following amounts are lying in Unpaid
Dividend Account of Omkar Speciality Chemicals Limited:
Financial Year Amount (in Rupees)
2010- 2011 17,948.00
2011- 2012 14,206.25
2012- 2013 29,673.00
2013- 2014 14,533.50
Those Members, who have not yet encashed their Dividend Warrants for
the financial year ended 31st March, 2011, 31st March, 2012, 31st
March, 2013 and 31st March, 2014 may approach the M/s Bigshare Services
Private Limited, Registrar and Share Transfer Agents of the Company /
the Company for completion of necessary formalities to claim the
dividend.
deposit from public:
Your Company did not invite or accept deposits from the public during
the year under review.
FINANCIAL STATEMENTS:
The Financial Statements have been prepared as per the Schedule III of
the Companies Act, 2013 as notified by the Ministry of Corporate
Affairs. Accordingly, the previous year's figures have also been
regrouped/ restated wherever necessary to conform to the classification
of the current year.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO:
The details pursuant to Section 134(3) of the Companies Act, 2013 read
with Rule 8, sub-rule (3) of Companies (Accounts) Rules, 2014 relating
to Conservation of Energy, Technology absorption, Foreign Exchange
earnings and outgo is provided in Annexure A and forms an integral part
of the Directors' Report.
extract of annual return:
The details forming part of the extract of the Annual Return in Form
MGT-9 as per Section 92 of Companies Act, 2013 read with Rule 12 of
Companies (Management and Administration) Rules, 2014, is included in
this report as Annexure B and forms an integral part of the
Directors' Report.
subsidiary companies:
A detailed discussion on the subsidiaries namely, Lasa Laboratory
Private Limited, Urdhwa Chemicals Company Private Limited, Rishichem
Research Limited and Desh Chemicals Private Limited, have been dealt in
the Management Discussion and Analysis (MD & A) section of Annual
Report.
The Consolidated Audited Annual Financial Statements are prepared as
per Section 129(3) read with Schedule III of the Companies Act, 2013,
Accounting Standards (AS-21) issued by the Institute of Chartered
Accountants of India as notified by the Ministry of Corporate Affairs
and Clause 32 of the Listing Agreement.
As per Section 129(3) of Companies Act, 2013 read with Rule 5 of
Companies (Accounts) Rules, 2014, a statement containing salient
features of the financial statements of the subsidiary companies in
Form AOC 1, is provided in Annexure C and forms an integral part of the
Directors' Report.
Based on the Consolidated Audited Annual Financial Results of the
Company for the Financial Year ended on 31st March, 2015, M/s Lasa
Laboratory Private Limited, wholly owned subsidiary of the Company has
become the material non-listed Indian subsidiary company.
The Company has formulated the Policy for dealing with the Material
Non-Listed Subsidiary Company and uploaded the same on the website of
the Company (Weblink:
http://www.omkarchemicals.com/Policies/RPT%20&%20Subsidiary%20Policy.pdf)
The Board of Directors in their meeting held on 2nd February, 2015,
granted in-principle approval for the formation of an overseas wholly
owned subsidiary company, with warehouse facility, for catering to the
overseas market and embark upon the growing exports.
CORPORATE SOCIAL RESPONSIBILITY (CSR):
During the current year, the Directors have constituted the CSR
Committee and adopted the Corporate Social Responsibility Policy. The
policy is displayed on Company's Web site (Weblink:
http://www.omkarchemicals.com/Policies/CSR-Policy OSCL. pdf). The
details on CSR have been briefly discussed in Annexure D and forms an
integral part of the Directors' Report.
PARTICULARS OF EMPLOYEES:
The information required under Section 197(12) of Companies Act, 2013
read with Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 and forming a part of the Director's Report
for the year ended 31st March, 2015 is given in a separate Annexure E
to this Report.
MANAGEMENT DISCUSSION AND ANALYSIS:
As required by Clause 49 of the Listing Agreement with Stock
Exchange(s), a Management Discussion & Analysis Report forms part of
the Annual Report.
HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL RELATIONS:
A detailed discussion on Human Resource Management and Industrial
Relations has been dealt in Management Discussion and Analysis (MD & A)
report.
REPORT ON CORPORATE GOVERNANCE:
A detailed Report on Corporate Governance pursuant to the requirements
of Clause 49 of the Listing Agreement with the Stock Exchange(s) forms
part of the Annual Report. A Certificate from the Auditors of the
Company, M/s J.PJ Associates, Chartered Accountants, confirming
compliance with the conditions of Corporate Governance as stipulated
under the aforesaid Clause 49, also forms part of the Annual Report.
REGULATORY APPROVALS:
The relevant regulations and policies as prescribed by the Government
of India and other regulatory bodies have been duly complied with by
your Company.
Our manufacturing facilities are monitored and approved by various
regulatory authorities. Periodically, the FDA, MPCB, Department of
Explosives etc. conducts routine audits of all approved facilities.
DIRECTORS (APPOINTMENT & RESIGNATION MADE DURING THE YEAR):
Pursuant to the provisions of Section 149 of the Companies Act, 2013
which came into effect from 1st April, 2014, Mr. Amit A. Pandit (DIN
02437092), Prof. (Dr.) Suhas M. Rane (DIN 03126514), Dr. Vikas N.
Telvekar (DIN 03123785) and Mr. Subhash P. Mali (DIN 00034769) were
appointed as Independent Directors at the Annual General Meeting of the
Company held on 9th August, 2014.
A) RE-APPOINTMENT
(1) In accordance with the provisions of Companies Act, 2013 and the
Articles of Association of the Company, Mrs. Anjali P. Herlekar (DIN
00527420), Non-Executive, Promoter and Woman Director of the Company,
retires by rotation at the forthcoming Annual General Meeting and being
eligible, has offered herself for re-appointment. The Board recommends
re-appointment of Mrs. Anjali P. Herlekar (DIN 00527420) as
Non-Executive, Promoter and Woman Director of the Company in the
ensuing Annual General Meeting of the Company.
(2) The Board of Directors at their meeting held on 2nd February, 2015
has re-appointed (Subject to the approval of Members in the general
meeting), Mr. Pravin S. Herlekar (DIN 00525610) as a Chairman and
Managing Director of the Company for a further period of five years
commencing from 1st April, 2015 till 31st March, 2020 pursuant to the
provisions of Section 196, 197 and such other provisions read with
Schedule V of the Companies Act, 2013. The terms of his appointment are
given in the explanatory statement to the Notice of Annual General
Meeting. The Board recommends re-appointment of Mr. Pravin S. Herlekar
(DIN 00525610) as Chairman and Managing Director of the Company, in the
ensuing Annual General Meeting of the Company.
(3) The Board of Directors at their meeting held on 2nd February, 2015
has re-appointed (Subject to the approval of Members in the general
meeting), Mr. Omkar P. Herlekar (DIN 01587154) as a Whole Time Director
of the Company for a further period of five years commencing from 1st
April, 2015 till 31st March, 2020 pursuant to the provisions of Section
196, 197 and such other provisions read with Schedule V of the
Companies Act, 2013. The terms of his appointment are given in the
explanatory statement to the Notice of Annual General Meeting. The
Board recommends re-appointment of Mr. Omkar P. Herlekar (DIN 01587154)
as Whole Time Director of the Company, in the ensuing Annual General
Meeting of the Company.
B) RESIGNATIONS
During the year under review, the following Directors have resigned
from the Board of M/s Omkar Speciality Chemicals Limited due to
pre-occupation in their professional commitments:
(1) Mr. Amit A. Pandit (DIN 02437092) has resigned as Non-Executive and
Independent Director and Chairman of the Audit Committee of the Company
w.e.f 26th March, 2015. The Board places on record its gratitude for
the services rendered by Mr. Amit A. Pandit (DIN 02437092) during his
long association with the Company.
(2) Mr. Siddharth S. Sinkar (DIN 05154432) has resigned as
Non-Executive and Non-Independent Director of the Company w.e.f. 26th
March, 2015. The Board places on record its gratitude for the services
rendered by Mr. Siddharth S. Sinkar (DIN 05154432) during his long
association with the Company.
C) APPOINTMENTS
The Company has appointed the following new Directors on the Board of
M/s Omkar Speciality Chemicals Limited:
(1) Mr. Laxmikant R. Kabra (DIN 0061346) was appointed as an Additional
Director in the capacity of Non-Executive and Non-Independent Director
of the Company w.e.f. 26th March, 2015, pursuant to Section 161(1) of
Companies Act, 2013. The detailed profile of Mr. Laxmikant R. Kabra
(DIN 0061346) is given as a part of Notice of Annual General Meeting.
The Board recommends appointment of Mr. Laxmikant R. Kabra (DIN
0061346) as Non-Executive and Non-Independent Director of the Company,
in the ensuing Annual General Meeting of the Company. He will be liable
to retire by rotation.
(2) Mr. Sitendu K. Sharma (DIN 01956423) was appointed as an Additional
Director in the capacity of Independent Director of the Company w.e.f.
8th May, 2015, pursuant to Section 149, 161(1) and other applicable
provisions of Companies Act, 2013. The detailed profile of Mr. Sitendu
K. Sharma (DIN 01956423) is given as a part of Notice of Annual General
Meeting. The Board recommends appointment of Mr. Sitendu K. Sharma (DIN
01956423) as an Independent Director of the Company for the period of
five years commencing from 8th May, 2015 till 7th May, 2020, in the
ensuing Annual General Meeting of the Company.
(3) Mr. Vikas G. Gadre (DIN 06746818) was appointed as an Additional
Director in the capacity of Independent Director of the Company w.e.f.
17th July, 2015, pursuant to Section 149, 161(1) and other applicable
provisions of Companies Act, 2013. The detailed profile of Mr. Vikas G.
Gadre (DIN 06746818) is given as a part of Notice of Annual General
Meeting. The Board recommends appointment of Mr. Vikas G. Gadre (DIN
06746818) as an Independent Director of the Company for the period of
five years commencing from 17th July, 2015 till 16th July, 2020, in the
ensuing Annual General Meeting of the Company.
(4) Mr. Subhash N. Ghalke (DIN 07239171) was appointed as an Additional
Director in the capacity of Independent Director of the Company w.e.f.
17th July, 2015, pursuant to Section 149, 161(1) and other applicable
provisions of Companies Act, 2013. The detailed profile of Mr. Subhash
N. Ghalke (DIN 07239171) is given as a part of Notice of Annual General
Meeting. The Board recommends appointment of Mr. Subhash N. Ghalke (DIN
07239171)as an Independent Director of the Company for the period of
five years commencing from 17th July, 2015 till 16th July, 2020, in the
ensuing Annual General Meeting of the Company.
(5) Mrs. Sanjivani S. Patare (DIN 07239170) was appointed as an
Additional Director in the capacity of Independent Director and Woman
Director of the Company w.e.f. 17th July, 2015, pursuant to Section
149, 161(1) and other applicable provisions of Companies Act, 2013. The
detailed profile of Mrs. Sanjivani S. Patare (DIN 07239170) is given as
a part of Notice of Annual General Meeting. The Board recommends
appointment of Mrs. Sanjivani S. Patare (DIN 07239170) as an
Independent Director and Woman Director of the Company for the period
of five years commencing from 17th July, 2015 till 16th July, 2020, in
the ensuing Annual General Meeting of the Company.
(6) Mr. Rishikesh P. Herlekar (DIN 05240009) was appointed as an
Additional Director in the capacity of Executive Director of the
Company w.e.f. 17th July, 2015, pursuant to Section 161(1), 196, 197
and such other provisions read with Schedule V of the Companies Act,
2013. The terms of his appointment and the detailed profile of Mr.
Rishikesh P. Herlekar (DIN 05240009) are given as a part of Notice of
Annual General Meeting. The Board recommends appointment of Mr.
Rishikesh P. Herlekar (DIN 05240009) as an Executive Director of the
Company for the period of five years commencing from 17th July, 2015
till 16th July, 2020, in the ensuing Annual General Meeting of the
Company. He will be liable to retire by rotation.
(7) Mr. Prakash H. Rao (DIN 07239167) was appointed as an Additional
Director in the capacity of Executive Director of the Company w.e.f.
17th July, 2015, pursuant to Section 161(1), 196, 197 and such other
provisions read with Schedule V of the Companies Act, 2013. The terms
of his appointment and the detailed profile of Mr. Prakash H. Rao (DIN
07239167) are given as a part of Notice of Annual General Meeting. The
Board recommends appointment of Mr. Praksah H. Rao (DIN 07239167) as an
Executive Director of the Company for the period of five years
commencing from 17th July, 2015 till 16th July, 2020, in the ensuing
Annual General Meeting of the Company. He will be liable to retire by
rotation.
The information as prescribed under Clause 49 of the Listing Agreement
entered with the Stock Exchange(s) such as brief description of the
Directors proposed to be appointed/re-appointed, the nature of their
expertise in specific functional areas and the names of the Companies
in which they hold directorships and memberships/chairmanships of board
committees are provided as a part of the Notice of the forthcoming
Annual General Meeting.
DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received declarations from all the Independent
Directors of the Company under Section 149 (7) of Companies Act, 2013
confirming that they meet with the criteria of independence as
prescribed both under sub-section (6) of Section 149 of the Companies
Act, 2013 and under Clause 49 of the Listing Agreement with the Stock
Exchanges.
MECHANISM FOR EVALUATING BOARD MEMBERS:
Pursuant to the provisions of Clause 49 of the Listing Agreement, the
Nomination and Remuneration Committee has been empowered for laying
down the evaluation criteria for performance evaluation of the
Independent Directors and the Board. The Nomination and Remuneration
Committee works with the entire Board to determine the appropriate
characteristics, skills and experience required for the Board as a
whole and for individual members. Board members are expected to possess
the required qualifications, integrity, expertise and experience for
the position. They should also possess deep expertise and insights in
sectors / areas relevant to the Company, and ability to contribute to
the Company's growth. The Board members are expected to rigorously
prepare for, attend and participate in all Board and applicable
committee meetings. Each member is expected to ensure that their other
current and planned future commitments do not materially interfere with
their responsibilities with the Company.
familiarisation programmes for board members:
The Board members are provided with necessary documents/brochures,
reports and internal policies to enable them to familiarize with the
Company's procedures and practices. The Chairman and Managing
Director had one to one discussions with newly appointed Directors to
familiarize them with the Company's operations. Periodic
presentations are made at the Board and Board Committee Meetings, on
business and performance updates of the Company, global business
environment, business strategy and risks involved. Quarterly updates
on relevant statutory and regulatory changes are circulated to the
Directors. Site visits to various plant locations are organized for the
Directors to enable them to understand the operations of the Company.
MEETINGS OF INDEPENDENT DIREcTORS:
The Company's Independent Directors shall meet at least once in every
financial year without the presence of Executive Directors or
management personnel. Such meetings are conducted informally to enable
Independent Directors to discuss matters pertaining to (i) review the
performance of Non Independent Directors and the Board as a whole, (ii)
review the performance of the Chairperson of the Company, taking into
account the views of Executive Directors and Non-Executive Directors;
and (iii) to assess the quality, quantity and timeliness of flow of
information between the Company Management and the Board.
One meeting of the Independent Directors was held during the Financial
Year on 6th February, 2015.
BOARD MEETINGS HELD DURING THE YEAR:
Seven Board Meetings were held during the Financial Year 2014-15 and
the gap between any two consecutive meetings did not exceed one hundred
and twenty days at any point of time.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirements under Section 134(5) of the Companies Act,
2013, with respect to the Director's Responsibilities Statement, the
Directors state and hereby confirm that:
a) In the preparation of the annual accounts for the year ended 31st
March 2015, the applicable accounting standards have been followed
along with proper explanation relating to material departures;
b) The Directors have elected 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 31st March 2015 and of the profit of the Company for
the year ended on that date;
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, 2013, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
d) The Directors have prepared the annual accounts on a going concern
basis;
e) The Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively; and
f) The Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems are
adequate and operating effectively.
KEY MANAGERIAL PERSONNEL:
During the year under review, the Company has appointed/re-appointed
the following persons as Key Managerial Personnel:
V Re-appointed Mr. Pravin S. Herlekar (DIN 00525610) as the Chairman
and Managing Director of the Company for a further period of five years
with effect from 1st April, 2015 on the terms and conditions and
Remuneration as set out in the agreement between the Company and
Chairman and Managing Director of the Company. Mr. Pravin S. Herlekar
(DIN 00525610) is also designated as Key Managerial Personnel pursuant
to provisions of Section 203 of the Companies Act, 2013, read with the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014. This appointment is subject to the approval of shareholders at
the forthcoming Annual General Meeting.
V Re-appointed Mr. Omkar P. Herlekar (DIN 01587154) as the Whole-time
Director of the Company for a period of five years with effect from 1st
April, 2015 on the terms and conditions and Remuneration as set out in
the agreement between the Company and Whole time Director of the
Company. Mr. Omkar P. Herlekar (DIN 01587154) is also designated as Key
Managerial Personnel pursuant to provisions of Section 203 of the
Companies Act, 2013, read with the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014. This appointment is
subject to the approval of shareholders at the forthcoming Annual
General Meeting.
V Appointed Mr. Hiral Patel as the Chief Financial Officer of the
Company for a period of one year with effect from 18th March, 2015
expiring on 17th March, 2016 on such terms and conditions decided by
the Board of Directors of the Company. Mr. Hiral Patel is also
designated as Key Managerial Personnel pursuant to provisions of
Section 203 of the Companies Act, 2013, read with the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014.
NOMINATION & REMUNERATION POLICY OF THE COMPANY:
During the current year, the Directors have reconstituted the
Nomination & Remuneration Committee and adopted the Nomination &
Remuneration Policy. The policy is displayed on Company's Web site
(Weblink: http://www.omkarchemicals.
com/Policies/Nomination-Remuneration-Policy.pdf).
The said policy has been briefly discussed in Annexure F and forms an
integral part of the Directors' Report.
PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS U/S 186:
Loan given during the financial year 2014-15
(Rs. In Lacs)
Particulars Opemng Additions Repaid closing Balance
Balance
Lasa Laboratory
Private Limited 250.68 745.61 0.00 996.29
Urdhwa Chemicals
Company Private
Limited 3,720.05 1,088.89 488.00 4,320.94
Note: Loans were given to wholly owned subsidiaries for business
purpose to meet working capital and capital expenditure requirements.
Corporate Guarantee provided during the financial year 2014-15
Name of the company for Name of the party in whose
whom guarantee is given favour guarantee given
Lasa Laboratory Private Axis Bank Limited
Limited
purpose of guarantee Amount for which guarantee
is given
For securing the repayment
of the credit facilities renewed Rs. 44.89 cr.
and enhanced during the year
Securities granted during the financial year 2014-15
No security has been provided by the Company in respect of loan taken
by any company or third party during the financial year 2014-15
Investments made during the financial year 2014-15
(Rs. In Lacs)
Opening Acquisition Sale / Closing
Sr. No. particulars Balance Redemption Balance
Acquired 1200000 equity
1 shares of Lasa Laboratory
Private Limited at rate
of Rs. 25/- 250.12 300.00 NIL 550.12
per share (Face value
Rs. 10/- per share)
Internal financial controls:
The Company has laid down the internal financial control system for
safeguarding the orderly and efficient conduct of business, including
adherence to Company's policies, the safeguarding of its assets, the
prevention and detection of frauds and errors, the accuracy and
completeness of the accounting records and timely preparation of
reliable financial information.
The Audit Committee reviews the Internal Audit function. The Audit
Committee also reviews the internal audit reports as well as the
findings of any internal investigation by internal auditors and
suggests the methods to strengthen the internal control system. After
reviewing the same, the Audit Committee reports the matters to the
Board and the corrective actions to be taken thereon.
RISK Management pOLIcY:
The Company has laid down procedures to inform the members of the Board
about the risk assessment and minimization procedures. These
procedures have been periodically reviewed to ensure that the executive
management controls the risk through properly defined framework.
Pursuant to Clause 49 of the Listing Agreement, the Board in its
meeting held on 18th May, 2015, constituted a Risk Management Committee
of the Directors.
WHISTLE BLOWER POLICY:
Pursuant to the Section 177(9) and (10) of the Companies Act, 2013 and
Clause 49 of the Listing Agreement, the Company has formulated Whistle
Blower Policy for vigil mechanism for Directors and Employees to report
the management about the unethical behavior, fraud, improper practice
or violation of the Company's Code of Conduct or complaints regarding
accounting, auditing, internal controls or disclosure practices of the
Company. It gives a platform to the whistle blower to report any
unethical or improper practice (not necessarily violation of law) and
to define processes for receiving and investigating complaints. The
mechanism provides adequate safeguards against victimization of
employees and directors who use such mechanism and makes provision for
direct access to the Chairman of the Audit Committee in exceptional
cases.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The Board has received Disclosures from the Directors relating to
material, financial and commercial transactions where they and / or
their relatives have personal interest. None of the transactions with
any of the related parties were in conflict with the Company's
interest. Company's major related party transactions are generally
with its subsidiaries. All the transactions entered into with the
related parties as defined under the Companies Act, 2013 and Clause 49
of the Listing Agreement during the financial year were in the ordinary
course of business and on arm's length basis and do not attract the
provisions of Section 188 of the Companies Act, 2013. There were no
materially significant transactions with related parties during the
financial year 2014-15. The details of transactions with related
parties are given for information under notes to the accounts of the
Balance Sheet as at 31st March, 2015.
significant and material orders passed by the regulators or courts or
tribunals:
There are no significant and material orders passed by the regulators
or courts or tribunals that would impact the going concern status of
the Company and its future operations.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has in place a policy on Prevention, Prohibition and
Redressal of Sexual Harassment at workplace in line with the
requirements of The Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013. An Internal
Complaints Committee (ICC) has been set up to redress complaints
received regarding sexual harassment. The policy has set guidelines on
the redressal and enquiry process that is to be followed by
complainants and the ICC, whilst dealing with issues related to sexual
harassment at the work place. All women employees (permanent,
temporary, contractual and trainees) are covered under this policy.
The Company has not received any complaints during the year.
GRANT OF PATENTS TO THE COMPANY:
1. The Company's claim for process patent for an advance intermediate
namely "5-IODO-2-METHYLBENZOIC ACID, having special applications in
pharmaceutical industry has been accepted by the Patents Office, Govt
of India, vide their Certificate No. 022/11015 Patent Registration No.
262739 dated 10th September, 2014.
2. The Company's claim for process patent for an advance intermediate
namely "BENZENESELENINIC ANHYDRIDE, having special applications in
pharmaceutical industry has been accepted by the Patents Office, Govt
of India, vide their Certificate No. 022/11999, Patent Registration
No. 263298 dated 17th October, 2014.
REGISTRATION OF THE TRADEMARK OF THE COMPANY:
The Trade Marks Registry, Government of India has granted its approval
by registering the Company's logo containing the tagline "OMKAR -
ALWAYS THE LEADERS" with effect from 21st June, 2010 (date of
application), vide its certificate No. 1205744 dated 15th April, 2015
having validity upto 20th June, 2020.
COMMENCEMENT OF THE NEW MANUFACTURING FACILITY AT CHIPLUN:
During the financial year 2014-15, the Company has commissioned
manufacturing at its new plant i.e. Unit No. VI located at Plot No.
B-15 & B-16, Lote Parshuram MIDC, Chiplun, Dist: Ratnagiri, State:
Maharashtra.
The plant with a volumetric capacity of 300 Metric Tonnes Per Annum
(MTPA) manufactures a number of advance intermediates for pharma
industry catering to essential life-saving drugs and veterinary APIs
with the state of the art facility for production and quality control.
During the financial year 2014-15, Lasa Laboratory Pvt. Ltd., wholly
owned subsidiary has completed phase I expansion of its manufacturing
unit. The volumetric capacity of the said unit was increased from 120
MTPA to 450 MTPA.
AUDITORS AND AUDITOR'S REPORT:
STATUTORY Auditors
The comments of the Auditors in their report and the notes forming part
of the Accounts are self-explanatory and need no comments.
In accordance with the provisions of Section 139(1) of Companies Act,
2013 and Rule 3, sub rule (7) of Companies (Audit and Auditors) Rules
2014, the shareholders at the last Annual General Meeting held on 9th
August, 2014 had approved the appointment of M/s. J.PJ. Associates,
Chartered Accountants, Mumbai (Firm Registration No. 113012W) as
Statutory Auditors of the Company effective till the conclusion of the
twelfth AGM to be held in the year 2017, subject to ratification of
their appointment at every AGM. M/s. J.P.J. Associates, Chartered
Accountants, Mumbai have expressed their willingness to continue as
Statutory Auditors of the Company, subject to their ratification by the
shareholders at the forthcoming Annual General Meeting. The Company has
obtained written consent and certificate from the Auditors, that their
appointment, on ratification of the shareholders would be in conformity
with the conditions specified in Rule 4 of Companies (Audit and
Auditors) Rules 2014.
COST AUDITORS
Pursuant to Section 148 (1) and (2) of the Companies Act, 2013 read
with Companies (Cost Records and Audit ) Rules, 2014, the Company is
required to get its cost records audited and should appoint a Cost
Auditor pursuant to Section 148(3) of the Companies Act, 2013 read with
Rule 14 of Companies (Audit & Auditors ) Rules, 2014.
The Board of Directors, on the recommendation of Audit Committee has
appointed M/s N. Ritesh & Associates as the Cost Auditors of the
Company to audit the Cost Accounts of the Company for the Financial
Year 2015-16, on a remuneration of Rs.75,000/- p.a. plus service tax as
applicable and reimbursement of out of pocket expenses. Pursuant to
Section 148 of Companies Act, 2013 read with Rule 14 of Companies
(Audit and Auditors) Rules, 2014 a resolution seeking member's
approval for the remuneration payable to the Cost Auditor forms part of
the Notice convening the Annual General meeting.
M/s N. Ritesh & Associates have confirmed their willingness and
eligibility for appointment under Section 148 of the Companies Act,
2013 read with Rule 14 of Companies (Audit and Auditors) Rules, 2014.
SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of Companies Act, 2013 and
the rules made thereunder, the Company has appointed M/s Nilesh A.
Pradhan & Co., Practicing Company Secretary (C.P. No. 3659) to
undertake the Secretarial Audit of the Company for the F.Y. 2015-2016.
The Secretarial Audit Report for the financial year ended 31st March
2015 is included as Annexure G and forms an integral part of this
report.
With regard to the comment contained in the Secretarial Audit Report
for the Financial Year 2014-15, pertaining to the requirement of
appointment of Company Secretary in the wholly owned subsidiary company
namely, Lasa Laboratory Private Limited, we wish to submit that, we are
in the process of identifying an appropriate candidate for appointing
as Company Secretary of M/s Lasa Laboratory Private Limited.
ACKNOWLEDGEMENTS:
Your Directors place on record their appreciation to Company's
esteemed clients, vendors, investors, business associates and bankers
for their continuous support to the Company.
The Directors also thank the Central & State Governments, Governments
of various countries, Customs & Excise Departments, Ministry of
Commerce, Ministry of Finance, Ministry of External Affairs, Ministry
of Corporate Affairs, Maharashtra Industrial Development Corporation
and other Government Agencies for their positive support and assistance
during the year.
Your Directors also place on record their appreciation for the
excellent contribution made by all the employees of OSCL Group through
their commitment, competence, co-operation and diligence to duty in
achieving consistent growth of the Company.
For and On behalf of the Board of Directors
Omkar Speciality chemicals limited
Date: 09/08/2015 pravin S. Herlekar Omkar R Herlekar
Place: Badlapur chairman & managing director Whole time director
(Din 00525610) (Din 01587154)
Mar 31, 2014
TO THE MEMBERS OF OMKAR SPECIALITY CHEMICALS LIMITED
The Directors have pleasure in presenting their Ninth Annual Report
and Audited Financial Statements for the financial year ended on 31st
March, 2014.
FINANCIAL HIGHLIGHTS
The financial performance of the Company for the year ended 31st March,
2014 is summarized below:
(Rs. in Lakhs)
Year ended Year ended
Particulars 31st March, 2014 31st March, 2013
INCOME
Revenue from Operation 20,962.11 20,153.12
Other Income 574.73 579.40
TOTAL REVENUE 21,536.84 20,732.52
EXPENDITURE
Cost of Material Consumed 9,354.11 11,935.71
Purchase of Stock in Trade 5,079.46 3,509.26
Changes in Inventories 283.38 (1,808.51)
Employee Benefits Expense 988.25 800.54
Finance Costs 1,174.63 743.16
Depreciation & Amortization Expense 610.16 568.43
Other Expenses 1,967.18 2,083.45
TOTAL EXPENDITURE 19,457.17 17,832.04
Profit before Exceptional Items &
Extraordinary Items and Tax 2,079.67 2,900.48
Exceptional Items & Extraordinary Items 6.60 -
PROFIT BEFORE TAX 2,073.07 2,900.48
Tax Expenses 612.85 820.38
PROFIT AFTER TAX 1,460.22 2,080.10
Balance in Profit & Loss Account
brought forward from previous year 3,737.52 2,149.60
Less: Appropriations
Proposed Dividend 294.42 294.42
Tax on Dividend 50.04 47.76
Transfer to General Reserve 100.00 150.00
Balance carried to Balance Sheet 4,753.28 3,737.52
PERFORMANCE REVIEW
During the financial year 2013-14, against the backdrop of a
challenging environment, your Company reported a top-line growth of 4%,
on standalone basis, over the previous year. At standalone level, the
Gross Revenue from Operations stood at Rs. 20,962.11 Lakhs as compared
with Rs. 20,153.12 Lakhs in the previous year. The Profit for the
financial year under consideration stood at Rs. 1,460.23 Lakhs as
compared with Rs. 2,080.10 Lakhs in the previous year.
The consolidated Gross Revenue from Operations for financial year
2013-14 stood at Rs. 24,027.98 Lakhs as compared with Rs. 21,169.24
Lakhs in the previous year, registering a growth of 13.5%. The
consolidated Profit for the financial year 2013-14 stood at Rs.
1,356.06 Lakhs as compared with Rs. 2,055.55 Lakhs in the previous
year.
DIVIDEND
Based on the Company''s performance, the Directors are pleased to
recommend for the approval of members a final dividend of Rs. 1.50 per
share (previous year Rs. 1.50 per share) on the capital of 1,96,28,004
Equity Shares of Rs. 10/- each. The final dividend on equity shares as
recommended above, if approved by the members would involve cash
outflow of Rs. 344.46 Lakhs including dividend tax of Rs. 50.04 Lakhs
[Previous years Rs. 342.18 Lakhs including dividend tax of Rs. 47.76
Lakhs].
TRANSFER TO RESERVES
Your Company proposes to transfer Rs. 100 Lakhs to General Reserve out
of the amount available for appropriations and an amount of Rs.
4,753.28 Lakhs is proposed to be retained in the Profit and Loss A/c.
HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL RELATIONS
A detailed discussion on Human Resource Management and Industrial
Relations has been dealt in Management Discussion and Analysis (MD & A)
report.
ACQUISITION OF RIGHTS IN THE LAND/ASSETS
During the financial year 2013-14, your Company has acquired the rights
of following plots/assets:
1.Plot No. W-93(A) admeasuring about 720 sq.mtrs. situated at MIDC,
Badlapur (E), Thane  421503 (adjacent to Unit No. I of the Company),
which earlier belonged to Desh Chemicals Pvt. Ltd., wholly owned
subsidiary of the Company, for the operational benefits of the Company.
2.Plot No. B-15 and B-16, admeasuring about 1800 sq.mtrs. each,
situated at Lote Parshuram Industrial Area, Village Awashi, Taluka
Khed, District Ratnagiri. The project work at this Unit has been
recently completed and we have started the trial runs therein. The
regular commercial production will start very shortly.
3.Plot No. D-27/4, admeasuring about 15030 sq.mtrs. situated at Lote
Parshuram Industrial Area, Taluka Khed, District Ratnagiri. This plot
is an adjacent plot to the existing Unit No. V (Plot No. D-27/5) of the
Company.
UNPAID DIVIDEND
As per the information obtained from Axis Bank Ltd., it has been noted
that the following amounts are lying in Unpaid Dividend Account of
Omkar Speciality Chemicals Limited:
Financial Year Amount (in Rupees)
2010-2011 14,206.25
2011-2012 17,948.00
2012-2013 29,710.50
Those Members who have not claimed their dividend are requested to
contact M/s Bigshare Services Private Limited, Registrar and Share
Transfer Agents of the Company / the Company for completion of
necessary formalities to claim the dividend.
FINANCIAL STATEMENTS
The Financial Statements have been prepared as per the revised Schedule
VI of the Companies Act, 1956 as notified by the Ministry of Corporate
Affairs. Accordingly, the previous year''s figures have also been
regrouped/ restated wherever necessary to conform to the classification
of the current year.
SUBSIDIARY COMPANIES
During the financial year 2013-14, the Company has acquired interest in
6 (six) Equity Shares of Rishichem Research Limited, so as to make it
100 % subsidiary company.
During the financial year 2013-14, the Company has acquired from Desh
Chemicals Private Limited, wholly owned subsidiary of the Company, the
assets like Plot No. W-93(A), situated at MIDC, Badlapur (E), Thane
421503 along with the building constructed thereon and Plant &
Machinery erected therein.
A detailed discussion on subsidiaries has been dealt in the Management
Discussion and Analysis (MD & A) Report.
In terms of the General Circular of the Ministry of Corporate Affairs,
Government of India has granted general exemption under Section 212(8)
of the Companies Act, 1956. In view of this, copies of the Balance
Sheet, Statement of Profit & Loss, Report of the Board of Directors and
Auditors of its subsidiaries namely Rishichem Research Limited, Desh
Chemicals Private Limited, Urdhwa Chemicals Company Private Limited and
Lasa Laboratory Private Limited have not been attached with the Balance
Sheet of the Company. These documents will be made available upon
request by any member of the Company interested in obtaining the same
at the Registered Office of the Company. However, as directed by the
MCA in the aforesaid circulars, the financial information of the said
subsidiaries has been disclosed in the Annual Report.
Further, pursuant to Clause 32 of the Listing Agreement with Stock
Exchange(s) and Accounting Standard (AS-21) issued by the Institute of
Chartered Accountants of India, Consolidated Financial Statements
presented by the Company in this Annual Report include financial
information of its aforesaid subsidiaries.
DEPOSIT FROM PUBLIC
Your Company did not invite or accept deposits from the public during
the year under review.
REGULATORY APPROVALS
The relevant regulations and policies as prescribed by the Government
of India and other regulatory bodies have been duly complied with by
your Company.
Our manufacturing facilities are monitored and approved by various
regulatory authorities. Periodically, the FDA, MPCB, Department of
Explosives etc. conducts routine audits of all approved facilities.
DIRECTORS
In accordance with the provisions of Companies Act, 2013 and the
Articles of Association of the Company, Mr. Siddharth S. Sinkar,
Director of the Company, retires by rotation at the forthcoming Annual
General Meeting and being eligible, has offered himself for
re-appointment. The Board recommends re-appointment of Mr. Siddharth S.
Sinkar in the ensuing Annual General Meeting of the Company.
Pursuant to the provisions of Section 149(1) of the Companies Act, 2013
and amended Clause 49 of the Listing Agreement, the Company shall have
Mandatorily atleast one woman director. In view of this, the Board at
its meeting held on 20th June, 2014, appointed Mrs. Anjali P. Herlekar
(Wife of Mr. Pravin S. Herlekar, Chairman and Managing Director &
Promotor) as an Additional Director in the capacity of the Promoter
Director and Woman Director of the Company. In terms of Section 161(1)
of the Companies Act, 2013, Mrs. Herlekar holds office as an Additional
Director upto the date of the ensuing Annual General Meeting but is
eligible to be appointed as a Director. Approval of Members is being
sought for her appointment as a Director at the ensuing Annual General
Meeting.
The Company had, pursuant to the provisions of Clause 49 of the Listing
Agreement entered into with Stock Exchange(s), appointed Mr. Amit A.
Pandit, Prof. (Dr.) Suhas M. Rane, Mr. Subhash P. Mali and Dr. Vikas N.
Telvekar as Independent Directors of the Company. These Directors were
appointed as Directors to retire by rotation under the provisions of
the erstwhile Companies Act, 1956.
As per Section 149(4) of the Companies Act, 2013 (Act), which came into
effect from 1st April, 2014, every listed public company is required to
have at least one-third of the total number of directors as Independent
Directors. Section 149(10) of Companies Act 2013 provides that
Independent Directors shall hold office for a term of up to five
consecutive years on the Board of the Company; and shall be eligible
for re-appointment on passing a special resolution by the shareholders
of the Company. Section 149(11) states that no Independent Director
shall be eligible for more than two consecutive terms of five years.
Pursuant to SEBI Circular No. CIR/CFD/POLICY CELL/2/2014 dated 17th
April, 2014, a person who has already served as an Independent Director
for five years or more in a Company as on 1st October, 2014 shall be
eligible for appointment, on completion of his present term, for one
more term of upto five years only. Section 149(13) states that the
provisions of retirement by rotation as defined under sub-sections (6)
and (7) of Section 152 of the Act shall not apply to such Independent
Directors.
In accordance with the provisions of Section 149 of the Act, these
Directors are being appointed as Independent Directors to hold office
as per their tenure of appointment mentioned in the Notice of the
forthcoming Annual General Meeting (AGM) of the Company.
The information as prescribed under Clause 49 of the Listing Agreement
entered with the Stock Exchange(s) such as brief description of the
Directors proposed to be appointed/re-appointed, the nature of their
expertise in specific functional areas and the names of the Companies
in which they hold directorships and memberships/chairmanships of board
committees are provided in annexure to the notice of the forthcoming
Annual General Meeting.
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet with the criteria of
independence as prescribed both under sub-section (6) of Section 149 of
the Companies Act, 2013 and under Clause 49 of the Listing Agreement
with the Stock Exchange(s).
DIRECTORS'' RESPONSIBILITY STATEMENT:
Pursuant to the requirements under Section 217 (2AA) of the Companies
Act, 1956, with respect to the Director''s Responsibility Statement, the
Directors state and hereby confirm that:
a) In the preparation of the annual accounts for the year ended 31st
March, 2014, the applicable accounting standards have been followed and
there are no material departures;
b)They have, in selection of the accounting policies, consulted the
Statutory Auditors and have 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 31st
March, 2014 and of profit of the Company for the financial year ended
31st March, 2014;
c)They have taken proper and sufficient care, to the best of their
knowledge and ability, for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956,
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
d) They have prepared the annual accounts on a going concern basis.
AUDITORS AND AUDITOR''S REPORT
The comments of the Auditors in their report and the notes forming part
of the Accounts are self-explanatory and need no comments.
With regard to the comment contained in the Point (ix)(b) in the
Annexure to Auditors'' Report, we wish to submit that, the Company has
received the scrutiny notices from Income Tax Department for A.Y
2009-10, A.Y 2010-11 and A.Y 2011-12, where in the Income Tax
Department, based on information received from VAT Department, raised
queries on few purchase transactions and disallowed them in the
scrutiny assessments. The Company strongly contends that disallowance
of the said transactions has caused hardship on the Company. Therefore,
the Company has filed an appeal with CIT(appeals) for all the three
Assessment Years.
With regard to the comment contained in the Point (xvii) in the
Annexure to Auditors'' Report, we wish to submit that, in absence of any
arrangement of long term funds to finance immediate acquisition of
assets of the existing factory including ready infrastructure at
chiplun and other additions to the Fixed Assets, the available working
capital funds got depleted, resulting in use of short term funds for
long term purposes which is temporary in nature. Further, it is
pertinent to take on the record that the Company has applied for and
obtained the sanction of long term loan for deploying the same in the
long term investments and taken appropriate steps to ensure that such
transactions shall be avoided in future.
The Company''s Statutory Auditors M/s. J.P.J. Associates, Chartered
Accountants, Mumbai (Firm Registration No. 113012W), retires as
Statutory Auditors at the ensuing Annual General Meeting. In accordance
with the provisions of Section 139(1) of Companies Act, 2013 and Rule
3, sub rule (7) of Companies (Audit and Auditors) Rules 2014, the Board
has recommended the appointment of M/s. J.P.J. Associates, Chartered
Accountants, Mumbai as Statutory Auditors of the Company from the
conclusion of the forthcoming AGM till the conclusion of the twelfth
AGM to be held in the year 2017, subject to ratification of their
appointment at every AGM. M/s. J.P.J. Associates, Chartered
Accountants, Mumbai have expressed their willingness to continue, if so
appointed for a further period of three years and as required under the
provisions of Section 139 of the Companies Act, 2013, the Company has
obtained written consent and certificate from the Auditors, proposed to
be re-appointed to the effect that their re-appointment if made, would
be in conformity with the conditions specified in Rule 4 of Companies
(Audit and Auditors) Rules 2014. A proposal seeking the re-appointment
of Auditors and fixing their term is provided as a part of the Notice
of the ensuing Annual General Meeting.
COST AUDITORS
Pursuant to the provisions of Section 233B of the Companies Act, 1956
and the General Circular issued by Ministry of Corporate Affairs, the
Board at its meeting held on 20th May, 2013 had appointed Mr. Vaibhav
P. Joshi, Cost Accountants, Mumbai, as the Cost Auditors of the Company
to carry out the audit of the Company''s Cost Accounting records for the
financial year ending on 31st March, 2014.
Mr. Vaibhav P. Joshi has joined M/s VV & Associates, Cost Accountants
as a Partner in April, 2014. He has informed the Board that, he will
conduct the audit of the Cost Accounts of the Company for the financial
year 2014-15 as a Partner of M/s VV & Associates, Cost Accountants.
Hence, in accordance with the provisions of Section 148 of Companies
Act, 2013, the Board has appointed M/s VV & Associates, Cost
Accountants, Mumbai, as the Cost Auditors of the Company to carry out
the audit of the Company''s Cost Accounting records for the financial
year 2014-2015 and has recommended a remuneration of Rs.2,00,000/- p.a.
(Rupees Two Lakhs) which shall be ratified by the members in Annual
General Meeting.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information as per Companies (Disclosure of particulars in the
Report of Board of Directors) Rules, 1988, relating to Conservation of
Energy, Technology absorption, Foreign Exchange earnings and outgo is
provided in Annexure forming part of this report.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217(2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the name and other particulars of the certain employees are
required to be set out in the Annexure to the Directors'' Report.
However, as per the provisions of Section 219(1)(b)(iv) of the said
Act, the Annual Report excluding the aforesaid information is being
sent to all the Members of the Company and others entitled thereto.
Members who are interested in obtaining such particulars may write to
the Company Secretary at its Registered Office.
MANAGEMENT DISCUSSION AND ANALYSIS
As required by Clause 49 of the Listing Agreement with Stock
Exchange(s), a Management Discussion & Analysis Report forms part of
the Annual Report.
REPORT ON CORPORATE GOVERNANCE
A detailed Report on Corporate Governance pursuant to the requirements
of Clause 49 of the Listing Agreement with the Stock Exchange(s) forms
part of the Annual Report. A Certificate from the Auditors of the
Company, M/s J.P.J Associates, Chartered Accountants, confirming
compliance with the conditions of Corporate Governance as stipulated
under the aforesaid Clause 49, also forms part of the Annual Report.
ACKNOWLEDGEMENTS
Your Directors place on record their appreciation to Company''s esteemed
clients, vendors, investors, business associates and bankers for their
continuous support to the Company.
The Directors also thank the Central & State Governments, Governments
of various countries, Customs & Excise Departments, Ministry of
Commerce, Ministry of Finance, Ministry of External Affairs, Ministry
of Corporate Affairs, Maharashtra Industrial Development Corporation
and other Government Agencies for their positive support and assistance
during the year.
Your Directors also place on record their appreciation for the
excellent contribution made by all the employees of OSCL Group through
their commitment, competence, co-operation and diligence to duty in
achieving consistent growth of the Company.
Date: 20/06/2014 For and On behalf of the Board of Directors
Place: Mumbai Omkar Speciality Chemicals Limited
Pravin S. Herlekar Omkar P. Herlekar
Chairman & Managing Director Whole Time Director
Mar 31, 2013
To The Members of OMKAR SPECIALITY CHEMICALS LIMITED
The Directors have pleasure in presenting their Eighth Annual Report
and Audited Financial Statements for the fnancial year ended 31st
March, 2013.
fInanCIal HIGHlIGHts
The fnancial performance of the Company for the year ended 31st March,
2013 is summarized below:
(Rs in Lakhs)
Particulars year ended
31st march, 2013 year ended
31st march, 2012
InCome
Revenue from Operation 20,153.12 16,694.80
Other Income 579.40 369.86
total revenue 20,732.52 17,064.66
eXpendIture
Cost of Material Consumed 11,935.71 10,773.33
Purchase of Stock in Trade 3,509.26 1,817.96
Changes in Inventories (1,808.51) (1,157.10)
Employee Benefts Expense 800.54 638.34
Finance Costs 743.16 809.53
Depreciation & Amortization Expense 568.43 562.09
Other Expenses 2,083.45 1,302.93
total eXpendIture 17,832.04 14,747.08
profIt Before taX 2,900.48 2,317.58
Tax Expenses 820.38 672.91
profIt after taX 2,080.10 1,644.67
Balance in Proft & Loss Account
brought forward from previous
year. 2,149.60 940.08
less: appropriations
Proposed Dividend 294.42 245.35
Tax on Dividend 47.76 39.80
Transfer to General Reserve 150.00 150.00
Balance carried to Balance sheet 3,737.52 2,149.60
performanCe revIeW:
The Revenue from Operations for the fnancial year under review has gone
up to Rs. 20,153.12 Lakhs as against Rs. 16,694.80 Lakhs in previous
year, registering a growth of 21%. The Proft after tax has also gone up
to Rs. 2,080.10 Lakhs in current year from Rs. 1,644.67 Lakhs in
previous year, registering a growth of 26%.
dIvIdend
Based on the Company''s performance, the Directors are pleased to
recommend for the approval of members a fnal dividend of Rs. 1.50 per
share (Previous Year Rs. 1.25 per share) on the capital of 19628004
Equity Shares of Rs. 10/- each. The fnal dividend on equity shares as
recommended above, if approved by the members would involve a cash out
fow of Rs. 342.17 Lakhs including dividend tax of Rs. 47.76 Lakhs
[Previous Year Rs. 285.15 Lakhs including dividend tax of Rs. 39.80
Lakhs].
transfer to reserves
Your Company proposes to transfer Rs. 150 Lakhs to General Reserve out
of the amount available for appropriations and an amount of Rs.
3,737.52 Lakhs is proposed to be retained in the Statement of Proft and
Loss.
Human resourCe manaGement and IndustrIal relatIons
A detailed discussion on Human Resource Management and Industrial
Relations has been dealt in Management Discussion and Analysis (MD & A)
report.
Ipo proCeeds utIlIZatIon
The objective of our IPO during January 2011 was to raise capital to
increase our capacities at various locations. The management has
obtained the approval from the members in the last Annual General
Meeting for utilization of the IPO funds for the expansion activities
in addition to the objects as proposed in earlier RHP. The utilization
of IPO proceeds is within the framework of the objectives as listed in
our RHP and the purposes other than those as stated in the notice
convening the Seventh Annual General Meeting.
Issue of Warrants ConvertIBle Into eQuIty sHares to promoters &
promoter Group
During the year under review, your Company has, in furtherance of
approval received from the Bombay Stock Exchange Limited (BSE), the
National Stock Exchange of India Limited (NSE) and Shareholders of the
Company, issued and allotted 950,000 Warrants, on preferential basis, @
Rs. 150/- per warrant, convertible into 950,000 Equity Shares of Rs.
10/- each. The above warrants were issued to Promoter & Promoter Group
on 6th March, 2013, in accordance with the SEBI (Issue of Capital &
Disclosure Requirements) Regulations, 2009.
CallInG off tHe amalGamatIon of desH CHemICals prIvate lImIted WItH
omkar speCIalIty CHemICals lImIted
Your Company had initiated the process of amalgamation of M/s Desh
Chemicals Private Limited, Wholly Owned Subsidiary of the Company, with
the Company on 5th April, 2012. However, due to too much delay in the
said process and evolvement of multiple regulations, the Board of
Directors have approved cancellation and calling off the process of
amalgamation. Further, the Board of Directors have approved the
acquisition of assets of M/s Desh Chemicals Private Limited comprising
of land, building and machinery for the operational benefts of the
Company.
unpaId dIvIdend
As per the information obtained from Axis Bank, it has been noted that
the amount of Rs.17,948/- and Rs.14,742.50 is lying in Unpaid Dividend
Account of Omkar Speciality Chemicals Limited in respect of the
dividend declared by the Company for the fnancial year 2010-2011 and
2011-2012 respectively. Those Members who have not claimed their
dividend are requested to contact Bigshare Services Private Limited,
Registrar and Share Transfer Agents of the Company / to the Company for
issuance of demand draft upon completion of necessary formalities in
the said behalf in lieu of such dividend warrants.
fInanCIal statements
The Financial Statements have been prepared as per the revised schedule
VI of the Companies Act, 1956 as notifed by the Ministry of Corporate
Affairs. Accordingly, the previous year''s fgures have also been
regrouped/ restated wherever necessary to conform to the classifcation
of the current year.
suBsIdIary CompanIes
During the year under consideration, your Company has acquired M/s Lasa
Laboratory Private Limited as a going on concern basis by acquiring all
the equity shares thereof entitling all the liabilities and assets
including plot of land situated at C-105, MIDC, Mahad, Village Khaire,
Birwali, Raigad- 402309 with effect from 9th April 2012 and the said
company was made a wholly owned subsidiary of M/s Omkar Speciality
Chemicals Limited. M/s Lasa Laboratory Private Limited is engaged in
the manufacturing of Anthelmintic APIs for veterinary applications. By
acquiring M/s Lasa Laboratory Private Limited, the Company has gained a
foothold in the API manufacturing space.
A detailed discussion on subsidiaries has been dealt in the Management
Discussion and Analysis (MD & A) Report.
In terms of the General Circular of the Ministry of Corporate Affairs,
Government of India has granted general exemption under Section 212(8)
of the Companies Act, 1956. In view of this copies of the Balance
Sheet, Statement of Proft & Loss, Report of the Board of
Directors and Auditors of its subsidiaries namely Rishichem Research
Limited, Desh Chemicals Private Limited, Urdhwa Chemicals Company
Private Limited and Lasa Laboratory Private Limited have not been
attached with the Balance Sheet of the Company. These documents will be
made available upon request by any member of the Company interested in
obtaining the same at the Registered Offce of the Company. However, as
directed by the MCA in the aforesaid circulars, the fnancial
information of the said subsidiaries has been disclosed in the Annual
Report.
Further, pursuant to Clause 32 of the Listing Agreement with Stock
Exchange(s) and Accounting Standard (AS-21) issued by the Institute of
Chartered Accountants of India, Consolidated Financial Statements
presented by the Company in this Annual Report include fnancial
information of its aforesaid subsidiaries.
deposIt from puBlIC
Your Company did not invite or accept deposits from the public during
the year under review.
reGulatory approvals
The relevant regulations and policies as prescribed by the Government
of India and other regulatory bodies have been duly complied with by
your Company.
Our manufacturing facilities are monitored and approved by various
regulatory authorities. Periodically, the FDA, MPCB, Department of
Explosives etc. conducts routine audits of all approved facilities.
dIreCtors
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company, Mr. Amit A. Pandit and Prof.
(Dr.) Suhas M. Rane retires by rotation at the forthcoming Annual
General Meeting and being eligible, offers themselves for
re-appointment.
The Board recommends re-appointment of both the Directors in the
ensuing Annual General Meeting of the company.
dIreCtors'' responsIBIlIty statement:
Pursuant to the requirements under Section 217 (2AA) of the Companies
Act, 1956, with respect to the Director''s Responsibilities Statement,
the Directors state and hereby confrm that:
a) In the preparation of the annual accounts for the year ended 31st
March 2013, the applicable accounting standards have been followed and
there are no material departures;
b) They have, in selection of the accounting policies, consulted the
Statutory Auditors and have 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 31st
March, 2013 and of proft of the Company for the fnancial year ended
31st March, 2013;
c) They have taken proper and suffcient care, to the best of their
knowledge and ability, for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956,
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
d) They have prepared the annual accounts on a going concern basis.
audItors and audItor''s report
The comments of the Auditors in their report and the notes forming part
of the Accounts are self-explanatory and need no comments.
The Company''s Statutory Auditors M/s. J.P.J. Associates, Chartered
Accountants, Mumbai retires as Statutory Auditors at the ensuing Annual
General Meeting and have expressed their willingness to continue, if so
appointed. As required under the provisions of Section 224(1B) of the
Companies Act, 1956 the Company has obtained written confrmation from
the Auditors, proposed to be re-appointed to the effect that their
re-appointment if made, would be in conformity with the limits specifed
in the said section. A proposal seeking their re-appointment is
provided as a part of the Notice of the ensuing Annual General Meeting.
Cost audItors
Pursuant to the provisions of section 233B of the Companies Act, 1956
and the notifcation issued by Ministry of Corporate Affairs, the Board
at its meeting held on 26th June 2012 has considered the proposal to
appoint Mr. Vaibhav P. Joshi (Membership No. M-15797), Practicing Cost
Accountant, to conduct the cost audit of the Company for the fnancial
year ended 31st March 2013. The Cost Compliance Report for the year
ended 31st March 2012 was fled with the Central Government on 03rd
January 2013.
ConservatIon of enerGy, teCHnoloGy aBsorptIon and foreIGn eXCHanGe
earnInGs and outGo
The information as per Companies (Disclosure of particulars in the
Report of Board of Directors) Rules, 1988, relating to conservation of
Energy, Technology absorption, Foreign Exchange earnings and outgo is
provided in Annexure forming part of this report.
partICulars of employees
In terms of the provisions of Section 217(2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the name and other particulars of certain employees are
required to be set out in the Annexure to the Directors'' Report.
However, as per the provisions of Section 219(1)(b)(iv) of the said
Act, the Annual Report excluding the aforesaid information is being
sent to all the Members of the Company and others entitled thereto.
Members who are interested in obtaining such particulars may write to
the Company Secretary at its Registered Offce.
manaGement dIsCussIon and analysIs
As required by Clause 49 of the Listing Agreement with Stock
Exchange(s), a Management Discussion & Analysis Report forms part of
the Annual Report.
report on Corporate GovernanCe
A detailed Report on Corporate Governance pursuant to the requirements
of Clause 49 of the Listing Agreement with the Stock Exchange(s) forms
part of the Annual Report. A Certifcate from the Auditors of the
Company, M/s J.P.J Associates, Chartered Accountants, confrming
compliance with the conditions of Corporate Governance as stipulated
under the aforesaid Clause 49, also forms part of the Annual Report.
aCknoWledGements
Your Directors place on record their appreciation to Company''s esteemed
clients, vendors, investors, business associates and bankers for their
continuous support to the Company.
The Directors also thank the Central & State Governments, Government of
various countries, Customs & Excise Departments, Ministry of Commerce,
Ministry of Finance, Ministry of External Affairs, Ministry of
Corporate Affairs, Maharashtra Industrial Development Corporation and
Government Agencies for their positive support and assistance during
the year.
Your Directors also place on record their appreciation for the
excellent contribution made by all the employees of OSCL Group through
their commitment, competence, co-operation and diligence to duty in
achieving consistent growth of the Company.
For and on behalf of the Board of
directors
omkar speciality Chemicals limited
Place: Mumbai
Date: 20th May, 2013 pravin s. Herlekar omkar p. Herlekar
Chairman &
managing director Whole time
director
Mar 31, 2012
To the members of Omkar Speciality Chemicals Limited
The directors have pleasure in presenting their seventh Annual Report
on the business and operations of the company and financial accounts
for the year ended March 31, 2012.
FINANCIAL HIGHLIGHTS
Particulars For the year ended For the year ended
March 31, 2012 March 31, 2011
Rs. in lakh Rs. in lakh
INCOME
Revenue from operation 16,694.80 10,676.00
Other income 369.86 53.46
Total Revenue 17,064.66 10,729.46
EXPENDITURE
Cost of material consumed 10,773.33 7,168.90
Purchase of stock in trade 1,817.96 988.73
Changes in the inventory (1,157.10) (698.27)
Employee benefits expense 638.34 320.71
Finance costs 809.53 527.62
Depreciation and amortization
expense 562.09 190.86
Other expenses 1,302.93 759.35
Total Expenditure 14,747.08 9,258.40
Profit Before Tax. 2,317.58 1,471.06
Tax expenses 672.91 457.02
Profit After Tax 1,644.67 1,014.04
Balance in profit & loss account
brought forward from 940.08 304.92
previous year.
Less:
Appropriations:
Proposed dividend (245.35) (196.28)
Tax on dividend (39.80) (32.60)
Transfer to general reserve (150.00) (150.00)
Balance carried to balance sheet 2,149.60 940.08
Year in retrospect
The revenue from operation increased to Rs.16,694.80 lakh during the
year, as compared to Rs 10,676.00 lakh in previous year, recording a
growth of 56.37%. The Profit After Tax (PAT) increased to Rs. 1,644.67
lakh from Rs. 1,014.04 lakh during the previous financial year,
registering a growth of 62,18 %.
DIVIDEND
The directors recommends the payment of final dividend of Rs-1.25 per
equity share of Rs.l0 each (previous year Rs.1 per equity share of
Rs.l0 each). If the final dividend as recommended above, is approved by
the members at the Annual General Meeting, the total outflow towards
dividend on equity shares for the year works out to Rs.285.15 lakh
including dividend tax of Rs.39.80 lakh (previous years Rs.228.88 lakh
including dividend tax of Rs. 32.60 lakh).
HUMAN RESOURCE MANAGEMENT & INDUSTRIAL RELATIONS
A detailed discussion on Human Resource Management & Industrial
Relations have been dealt in the management discussion and analysis
(MD&A) report.
IPO PROCEEDS UTILIZATION
The objective of our IPO during January 2011 was to raise capital to
increase our capacities at various locations. The utilization of IPO
proceeds is within the framework of the objectives as listed in our
RHP.
ACQUISITION OF LAND /ASSETS
During the year, the company acquired Lease hold land at Plot No. W-94
and Plot No. W-95, MIDC Badlapur. admeasuring 720 sq mtrs each. The
plots are located adjacent to our subsidiary company, Desh Chemicals
Private Limited. Further, the company also acquired lease hold land at
Plot No. F-9. MIDC, Badlapur, ad measuring 2.519 sq mtrs. The plot is
also located adjacent to Unit No. IV i.e Plot F-10. MIDC, Badlapur
Another Lease hold plot was acquired at D 27/5. Lote Parshuram MIDC.
Chiplun with an area ad measuring 40,773 sq mtrs. Additionally, the
company also acquired residential premises at Badlapur and Chiplun. The
residential premises are mainly used for housing of employees as well
as visitors.
SUBSIDIARIES
A detailed discussion on subsidiaries has been dealt in the management
discussion and analysis (MD&A) report,
FINANCIAL STATEMENTS
The financial statement was prepared as per the revised schedule VI of
the Companies Act. 1956 as notified by the Ministry of Corporate
Affairs. Accordingly, the previous year's figures were also
regrouped/restated wherever necessary to conform to the classification
of the current year.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
The Ministry of Company Affairs granted a general exemption to
companies, by General Circular No, 2/2011 dated February 8, 2011.
under section 212 (8) of Companies Act, 1956. from attaching individual
accounts of subsidiaries with annual reports, Accordingly, board of
directors of the company, by resolution, gave their consent for not
attaching the balance sheet, profit & loss account and other documents
of its subsidiaries in the annual report of the company for the
financial year ended March 31, 2012. However, the consolidated
financial statements of the subsidiaries prepared in accordance with
accounting standard 21 issued by Institute of Chartered Accountants of
India, form part of the Annual Report, and are reflected in the
consolidated accounts of the company. The statement pursuant to section
212 of the Companies Act. 1956 containing details of the subsidiaries
of the company forms part of annual report
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, the directors,
based on the representations received from the operating management,
confirm that:
(I) In the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no material
departures.
(II) They have, in the selection of the accounting policies, consulted
the statutory auditors and have 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) They have taken proper and sufficient care, to the best of their
knowledge and ability, for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956,
for safeguarding the assets of the company and for preventing and
detecting fraud and other irregularities.
(IV) They have prepared the annual accounts on a going concern basis.
AUDITOR'S REPORT
The Auditor's report to the shareholders does not contain any
qualification.
UNPAID DIVIDEND
As per the information obtained from Axis Bank, it has been noted that
the amount of Rs. 0.19 lakh is lying with Omkar Speciality Chemicals
Limited in respect of the dividend declared by the company for the
financial year ended 2010-2011. Those members who have not claimed
their dividend are requested to contact the company's Registrar & Share
Transfer Agent to revalidate the dividend warrant.
TRANSFER TO RESERVES
The company proposes to transfer Rs. 150 lakh to the general reserve
cut of the amount available for appropriations and an amount of Rs.
2149.60 lakh is proposed to be retained in the profit & loss account,
DEPOSIT FROM PUBLIC
The company has not accepted any fixed deposits during the year ended
March 31, 2012.
CONSOLIDATED FINANCIAL STATEMENTS
Your directors have the pleasure in attaching the consolidated
financial statements pursuant to clause 32 of the listing agreement
entered into with the stock exchanges prescribed by The Institute of
Chartered Accountants of India (ICAI). in this regard, The Auditor's
report to the shareholders does not contain any qualification.
AUDITORS OF THE COMPANY
The company's previous auditors, M/s. Siddharth Sinkar & Associates had
shown their unwillingness to continue as statutory auditors for the
financial year 2011-2012. M/s. J.P.J Associates, Mumbai were appointed
as statutory auditors at the previous Annual General Meeting held on
September 24,2011.
The company received certificate from M/s. J.P.J. Associates to the
effect that their appointment, if made, would be within the prescribed
limits under section 224(1) of the Companies Act, 1956. You are
requested to re-appoint auditors to hold such office from the
conclusion of this Annual General Meeting till the conclusion of next
Annual General meeting and to fix their remuneration.
COST AUDITORS
Pursuant to the directive of the Central Government under the
provisions of section 233B of the Companies Act, 1956, the board at its
meeting held on June 24, 2012 has considered the proposal to appoint
M/s. Vaibhav P. Joshi, (Membership No: M-15797) Cost Accountant to
conduct cost audit subject to approval of the Central Government.
PARTICULARS OF EMPLOYEES
The statement as required under section 217(2A) of Companies Act, 1956,
containing the particulars as prescribed under the Companies
(Particulars of Employees) Rules, 1975 is provided in the Annexure-3
forming the part of this report.
REGULATORY APPROVALS
The relevant regulations and policies as prescribed by the Government
of India and other regulatory bodies have been duly complied with by
your company. Our manufacturing facilities are monitored and approved
by various regulatory authorities. Periodically, the FDA, MPCB and
various other statutory departments under Central & State Government
conduct routine audits of all approved facilities.
DIRECTORS
Pursuant to the provision of section 260 of the Companies Act 1956 and
Article 120 of Article of Association of the company. the board at its
meeting held on April 5, 2012 appointed Mr. Siddharth S. Sinkar as the
Additional Director (Non Executive and Non Independent) on April 5.
2012. As per the provisions of the above said section of the Act, he
holds office upto the date of this Annual General Meeting and is
eligible forgetting appointed as a Director (Non Executive and Non
Independent) of the board of the company. The company received a notice
from two members, along with the requisite deposit under section 257 of
the Companies Act 1956 proposing his candidature for appointment as the
Director (Non Executive and Non Independent) of the company. The
information as prescribed under clause 49 of the listing agreement
entered with the stock exchanges such as brief description of the
directors proposed to be appointed/reappointed. the nature of their
expertise in specific functional areas and the names of companies in
which they hold directorships and memberships/chairmanships of board
committees, are provided in annexure to the notice of the forthcoming
Annual General Meeting. The remuneration committee and the board at its
meeting held on June 26, 2012 recommended the revision in the
remuneration of Mr. Pravin S. Herlekar, Chairman & Managing Director
and Mr. Omkar P. Herlekar, Whole Time Director for the remainder of
their term upto March 31, 2015, and the same is mentioned in detail in
the explanatory statement to item Mo. 8 & 9 of the notice of the Annual
General Meeting.
REPORT ON CORPORATE GOVERNANCE
Pursuant to clause 49 of the listing agreement with the stock
exchanges, the following forms part of this annual report:
(I) Report on corporate governance
(II) Chairman & Managing Director's declaration regarding compliance of
code of conduct by board members and senior management personnel
(III) Auditor's certificate regarding compliance of conditions of
corporate governance.
(IV) Management discussion and analysis.
DEPOSITORY SYSTEM
As the members are aware the company's shares are compulsory tradable
in electronic form. As on March 31, 2012, almost 100% of the company's
total paid up capital representing 19,62,9004 equity shares were in
dematerialized form. In view of the numerous advantages offered by the
depository system, members holding shares in physical mode are advised
to avail of the facility of dematerialization on either of the
depositories,
ACKNOWLEDGEMENTS
Your directors take this opportunity to thank the company's customers,
members, vendors and bankers for their continued support during the
year. Your directors also wish to thank the Government of India and its
various agencies, Customs and Excise department. Ministry of Commerce.
Ministry of Finance. Ministry of External Affairs. Ministry of
Corporate Affairs. Reserve Bank of India. State Government of
Maharashtra and other local government bodies for their support and
look forward to their continued support in the future. Your directors
also place on record their appreciation for the excellent contribution
made by employees of the company through their commitment, competence,
cooperation and diligence with a view to achieving consistent growth
for the company.
For and on behalf of Board of Directors of
Omkar Speciality Chemicals Limited
Pravin S. Herlekar
Chairman & Managing Director
Date: June 24, 2012
Place: Badlapur, Thane District
Mar 31, 2011
The Members,
The Directors have pleasure in presenting the Sixth Annual Report
before you, on the working of the Company, alongwith the audited
accounts for the financial year ended 31st March 2011.
FINANCIAL HIGHLIGHTS
( Rs. In lakhs)
Particulars Year ended Year ended
31st March, 2011 31st March, 2010
Income 10773.92 6891.91
Profit Before Depreciation and Tax 1661.92 934.21
Less: Depreciation 190.86 185.34
Profit Before Tax (PBT) 1471.06 748.87
Less: Provision for Income Tax 457.02 230.50
Profit After Tax (PAT) 1014.04 518.37
Profit brought forward from previous year 304.92 904.46
Profit available for appropriation 1318.96 1422.83
Appropriations:
Transfer to General Reserve 150.00 150.00
Proposed Dividend 196.28 57.64
Corporate Tax on dividend 32.60 9.57
Profit carried to Balance Sheet 940.08 304.92
REVIEW OF OPERATIONS
i. Increase in Sales and Profit of the Company
Your Directors are pleased to inform you that there is a significant
growth in the total income and profit after tax despite of global
downturn and recessionary trend. Your Company has registered a growth
of 56.33% in total income and 95.62% in profit after tax. The almost
two fold growth in profit from operations was primarily on account of
cost optimization, higher gross margin in product mix and efficient
working capital management.
New markets were also explored for Company's existing products, thereby
increasing exports revenues. The same has been indicated in the growth
of total income. This can be seen from the tabular presentation as
given below;
( Rs. in lakhs)
Particulars Year ended Growth
31/03/2011 31/03/2010
Domestic Sales (Net) 9527.81 6259.00 52.23%
Export Sales 1148.19 575.96 99.35%
ii. Manufacturing Facility
Your Company has a diverse product range comprising a mix of organic,
inorganic and organo inorganic intermediates. The total product mix
comprises of more than 105 products which contain wide range of
inorganic intermediates like derivatives of molybdenum, selenium,
iodine, cobalt, bismuth and tungsten; organic intermediates like
resolving agents and hypervalent Iodine compounds. Our R&D team is
continuously working on the improvement in processes of our existing
products in order to smoothen the production process with optimum
utilization of resources and cost saving. These provide us a
competitive edge over others and help us to widen our customer base.
The variety of diverse product mix has enabled the Company to cater to
the need of larger base of existing as well as prospective customers.
Your Company has a diverse customer base from different industry
segments like pharmaceutical, chemical, glass, cosmetics, ceramic
pigments, poultry, veterinary feed etc. and export of our products to
various countries in Europe, Asia, North America and Australia.
Your Company has always given paramount importance to explore new
market opportunities. The philosophy of the Company is driven by
market adoptive principles in order to support the ambitious growth
plans the company has set for itself.
Your Company is currently expanding its capacity to 3,650 MTPA from 950
MTPA. The said expansion of capacity is expected to be completed by the
end of Financial Year 2013. Currently we have three (3) manufacturing
units in Badlapur MIDC, Thane and plan to set up fourth one in the same
industrial area.
Unit Location Existing Proposed Type of facility Products
Capacity additional manufactured
(MTPA) Capacity
(MTPA)
Unit I Plot no.
W-92(A), 375 225 Manufacturing
Unit Iodine,
Selenium
MIDC, Badlapur Compounds &
Other
Derivatives
Unit II Plot no. F-24, 375 525 Manufacturing
Unit Iodine,
Molybdenum
MIDC, Badlapur Compounds &
Other
Derivatives
Viz-Chiral
Compounds
Unit
III Plot no. B-34, 200 700 Registered Office,Selenium
Sulphide
MIDC, Badlapur Manufacturing
Unit (U.S.P.)
and Technology
Centre
Unit IV Plot No. F-10/1, - 1250 Warehouse and
Proposed Organic
MIDC, Badlapur Manufacturing
Unit Intermedi
-ates.
Total 950 2700
After the proposed expansion of the manufacturing facility the total
installed capacity of the company would aggregate to 3650 MT per annum.
DIVIDEND
Your Directors are pleased to recommend a dividend of 10% per equity
share of Rs. 10 each for the financial year 2010-11. The Dividend on
Equity Shares is subject to the approval of the Shareholders at the
Annual General Meeting. The total pay-out works out to Rs. 196.28 Lakhs
towards dividend and Rs. 32.60 Lakhs towards corporate dividend
distribution tax.
LISTING OF THE COMPANY
Your Company entered the Capital Market in the month of February, 2011
with an issue size of Rs. 81 Lakhs Equity Shares of Rs. 10 each issued
at a price of Rs. 98 (including premium of Rs. 88) amounting to Rs.
7938 Lakhs.
The shares issued under Initial Public Offer (IPO) have been listed on
Bombay Stock Exchange Limited (BSE) and National Stock Exchange of
India Limited (NSE).
DEPLOYMENT OF FUNDS
The prime intention behind raising funds from the public was for
expansion of existing manufacturing facilities and fulfilment of
Working Capital requirements.
The brief highlights of Company's achievements are as follows:
1) Your Company has received FDA License numbered KD - 725, dated 7th
of May, 2011 for Unit No. Ill for manufacture of Selenium Sulphide
(U.S.P.), which is the key ingredient for production of Anti-Dandruff
shampoo.
The production of Anti-Dandruff agent for shampoo at this Unit is
already started. This facility was financed out of IPO Proceeds as
elaborated in Red Herring Prospectus (RHP) of IPO.
2) On 17th June, 2011, your Company acquired 100% shares and assets of
Desh Chemicals Private Limited which owns a manufacturing Unit located
at W-93(A), MIDC, Badlapur, adjacent to your Company's Unit No. I
[W-92(A), MIDC, Badlapur]. Now we can act on our expansion and
modernization plan for our production capacities at Unit No. I, as
elaborated in Red Herring Prospectus (RHP) of Initial Public Offer
(IPO). The combined areas of existing Unit I and the newly acquired
Company will be operated as integral facility of Unit I.
3) Your Company has entered into a Memorandum of Understanding with
M/s. Shree Sai Shakti Enterprises, a proprietary concern, located at
F-9, MIDC, Badlapur for acquiring their assets.
These assets are adjacent to Company's existing Unit No. IV located at
F-10/1, MIDC, Badlapur. By virtue of this acquisition, the Company can
take benefit of the total plot area of 9654 sq. mtrs for execution of
our major expansion project at Unit No. IV as elaborated in RHP of IPO.
4) Your Company has also taken effective steps for acquiring shares and
assets of M/s. Urdhwa Chemicals Company Private Limited located at C-4,
Lote Parshuram Industrial Area, Dist: Ratnagiri for our further
expansion of manufacturing facility of value added speciality
chemicals. This project will be funded out of Company's internal
accruals, and suitable debt from financial institution.
SUB-DIVISION OF SHARES
Company's Shareholding base is of 1,96,28,004 Equity shares of Rs. 10
each as on 31st March, 2011. The Company, vide Special Resolution
passed at the Extra Ordinary General Meeting held on 19th May, 2010
subdivided the nominal value per share from Rs. 100 each to Rs. 10
each.
Post Issue the Paid Up Capital of the Company is Rs. 19,62,80,040.
SUBSIDIARY COMPANY
The Consolidated Financial Statements presented by the Company include
financial information of its subsidiary prepared in compliance with the
applicable Accounting Standards. The Ministry of Corporate Affairs,
Government of India vide its circular No 5/12/2007-CL-III dated 8th
February, 2011 has granted general exemption under section 212 (8) of
the Companies Act, 1956 from attaching the Balance Sheet, Profit And
Loss Account and other documents of the Subsidiary Company to the
Balance Sheet of the Company, provided certain conditions are
fulfilled. In terms of the aforesaid approval, the Annual Accounts of
the Subsidiary Company and the related detailed information will be
made available upon request. This document is available for inspection
by any member at the Registered Office of the Company.
In May 2010, Company has purchased 98.81% of Equity Shares of M/s.
Rishichem Research Limited and thereby it became our Subsidiary.
REGULATORY APPROVALS
Our manufacturing facilities are monitored and approved by various
Regulatory Authorities periodically. FDA, MPCB, Department of
Explosives, etc. conduct routine audits of all approved facilities.
TRANSFER TO RESERVES
The Company proposes to transfer Rs. 1.5 Crore to General Reserve out
of the amount available for appropriations and an amount of Rs. 13.18
Crore is proposed to be retained in the Profit and Loss Account.
CHANGE OF AUDITORS
M/s Siddharth Sinkar & Associates, Chartered Accountants, Mumbai, have
expressed their desire to be relieved from the duties as a Statutory
Auditor due to pre-occupation and they retire at the conclusion of the
Annual General Meeting subject to the approval of the members at the
Annual General Meeting. The Board has recommended the appointment of
M/s. J.PJ. Associates of Mumbai, Chartered Accountants as Statutory
Auditors at the forthcoming Annual General Meeting subject to the
approval of the members in the place of M/s Siddharth Sinkar &
Associates, retiring Auditors of the Company.
PUBLIC DEPOSITS
The Company has not accepted any fixed deposits from public during the
year ended 31st March, 2011.
DIRECTORS
During the Financial Year the Directors of the Company, Mr. Shivdas R.
Herlekar and Mrs. Anjali P. Herlekar resigned from Directorship on 29th
March, 2011. The Board places on record its appreciation of the
valuable services rendered by them during their tenure as Directors and
for their contributions to the deliberations of the Board.
Mr. Amit A. Pandit and Prof. Suhas M. Rane retire by rotation and are
eligible for re-appointment.
INDUSTRIAL RELATIONS AND HUMAN RESOURCE MANAGEMENT
The Board wishes to place on record their appreciation of the support
and contribution of all employees towards the growth of the company.
The Company continues to enjoy cordial and harmonious relations with
its employees at all levels.
The Company's HR policies and processes are aligned to effectively
drive its expanding business and emerging opportunities. This has been
achieved by continuously investing in learning and conducting training
and development programs, creating a congenial work environment and
motivating employees at all levels.
ENVIRONMENT
All the existing units of the Company treat the liquid effluent as per
the standard norms set by the consent to operate given by State
Pollution Control Board. The neutralized effluent is aerated by
compressed air so as to maintain the BOD / COD at desired level. Our
aim in future is to achieve zero pollution loads, total recycling of
treated water and maximum recovery from waste. We are aiming to set the
Pollution Free and Environmental Friendly Production Processes. Our R&D
team is consistently working on these issues and the results are
encouraging.
EMPLOYEE PARTICULARS AS PER SECTION 217 (2A)
The statement as required under Section 217 (2A) of Companies Act,
1956, containing the particulars as prescribed under the Companies
(Particulars of Employees) Rules, 1975 is annexed as Annexure - I to
this report.
ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE
Information on Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and outgo as required under Section 217(l)(e)
of the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988, are given
in Annexure - II annexed to this Report.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION ANALYSIS REPORT
Pursuant to clause 49 of the Listing Agreements with the Stock
Exchanges, a Management Discussion and Analysis Report, Corporate
Governance Report, Managing Director's and Auditor's Certificate
regarding compliance of conditions of Corporate Governance are made a
part of this Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements under Section 217 (2AA) of the Companies
Act, 1956 with respect to the Directors' Responsibilities Statement,
your Directors state and hereby confirm that:
a) Your Company has, in preparation of the Annual Accounts for the year
ended 31st March, 2011, followed the applicable accounting standards
alongwith proper disclosures and explanations relating to material
departures, if any;
b) 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 your Company as at 31st March 2011 and of the profit of your Company
for the Financial Year ended 31st March 2011;
c) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of your Company and
for preventing and detecting fraud and other irregularities;
d) The Directors have prepared the Annual Accounts for the Financial
Year ended 31st March 2011 on a going concern basis.
APPRECIATION
The Board of Directors wish to place on record their appreciation for
the support and co-operation extended by all the shareholders,
employees, Auditors, Bankers, Staff Members of the Company and all
others who have made valuable contributions to the growth of OSCL
For and on Behalf of Board of Directors
of Omkar Speciality Chemicals Limited
Dated: 5th August, 2011
Place : Badlapur Pravin S. Herlekar
Chairman and Managing Director
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