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Aadi Industries Ltd.

BSE: 530027 Sector: Industrials
NSE: N.A. ISIN Code: INE563D01013
BSE LIVE 15:14 | 06 Dec 1.45 0
(0.00%)
OPEN

1.45

HIGH

1.45

LOW

1.45

NSE LIVE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 1.45
PREVIOUS CLOSE 1.45
VOLUME 223
52-Week high 3.17
52-Week low 1.11
P/E
Mkt Cap.(Rs cr) 1.45
Buy Price 1.38
Buy Qty 2000.00
Sell Price 1.40
Sell Qty 2000.00
OPEN 1.45
CLOSE 1.45
VOLUME 223
52-Week high 3.17
52-Week low 1.11
P/E
Mkt Cap.(Rs cr) 1.45
Buy Price 1.38
Buy Qty 2000.00
Sell Price 1.40
Sell Qty 2000.00

Aadi Industries Ltd. (AADIINDUSTRIES) - Director Report

Company director report

AADI INDUSTRIES LIMITED ANNUAL REPORT 2010-2011 DIRECTORS' REPORT To The Members, Your Directors have pleasure in presenting the Seventeenth Annual Report on the operations of the Company together with the audited accounts for the year ended 31st March, 2011. Financial Results: Financial Results for the year ended 31st March, 2011 are as under: (Rs. in lacs) Current Previous Financial Year Financial Year 2010-11 2009-10 Net Sales and other Income 12102.84 7664.30 Profit before Depreciation, 894.99 535.61 Interest and Tax (PBDIT) Less: Interest 396.82 230.54 Depreciation 55.16 41.03 Profit before Taxation 443.01 264.04 Less: Provision for Taxes -Income Tax 130 67.94 -Deferred Tax Asset 19.54 16.62 -Prior Period Item 8.22 0.00 Profit after Taxation 285.25 179.48 Balance brought from 126.56 5.58 previous year Balance available for 411.81 185.06 appropriation APPROPRIATION: Proposed Dividend 50.00 50.00 Dividend Tax 8.50 8.50 Profit carried to Balance Sheet 353.31 126.56 Performance: During the year under review, your Company achieved sales of Rs. 12102.84 lacs and earned net profit after tax of Rs. 285.25 lacs compared to Rs. 7664.30 lacs and Rs. 179.48 lacs respectively for the previous financial year. Dividend: Your Directors are pleased to recommend final dividend @ Re. 0.50/- per share for the Financial Year 2010-11 subject to approval of the shareholders at the ensuing Annual General Meeting, which if approved, would absorb Rs. 58.50 lacs on account of dividend and distribution tax thereon. Directors: In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Mrs. Mansi Shah Director of the Company, retires by rotation and being eligible, offers herself for re- appointment at the ensuing Annual General Meeting. Mr. R.C. Singhvi was appointed as an Additional Director with effect from 1st December, 2010 to hold office upto the date of ensuing Annual General Meeting. However due to his pre occupation resigned from the office of director of the Company with effect from 26th March 2011. Mr. C. R. Mehta and Mr. Surjit Banga Independent Directors also resigned from the directorship of the Company with effect from 26th March 2011 and 6th July 2011 respectively. The Board places on record its deep appreciation of the invaluable services rendered by Mr. C. R. Mehta, Mr. Surjit Banga and Mr. R. C. Singhvi during their respective tenure as Director of the Company. Mr. Sunil Mistry, Independent Director was appointed as the Additional Director of the Company w.e.f. 30th May, 2011 to hold office upto the date of ensuing Annual General Meeting and being eligible offer himself for reappointment. The Company has received a notice under Section 257 of the Companies Act, 1956 proposing his candidature as Director of the Company. Alternation of Object Clause: The Object Clause of the Company was altered through Postal Ballots. The Members of the Company vide resolution passed at the Annual General Meeting of the members of the Company held on 26th August, 2010 altered the Object Clause of the Company and adopted the business as mentioned in the then inserted Clauses 67 to 70 under Part C of Object Clause of the Company. There after the said Objects were adopted as the Main Object of the Company substituting the then Main Objects. Directors' Responsibility Statement: Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors confirm that: - in the preparation of the annual accounts, the applicable Accounting Standards have been followed and no material departures were found; - the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2011 and of the profit of the Company for the year; - the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; - the annual accounts for the year ended 31st March, 2011 have been prepared on going concern basis. Public Deposits: The Company has not accepted any deposit pursuant to provisions of Section 58A of the Companies Act, 1956 read with the Companies (Acceptance of Deposits) Rules, 1975. Delisting of Shares: The Company had made an application to Vadodara Stock Exchange for delisting of its shares since there was no trading of shares at the said Stock Exchange. The Company's said application for delisting of shares was approved by the Managing Body of the said Stock Exchange. The Company has been informed by the said Stock Exchange vide their letter dated 27th January, 2011 that the trading of shares of the Company have been delisted from the said Stock Exchange accordingly the shares of the Company is now listed only on Bombay Stock Exchange. Auditors: M/s Sunderji Gosar & Co., Chartered Accountants, the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment. The retiring Auditors have furnished a certificate of their eligibility for re-appointment under Section 224(1 B) of the Companies Act, 1956 and have indicated their willingness to continue in the said office. Members are requested to appoint auditors for the current year and to authorize the Board to fix their remuneration. Auditors' Report: As regards observations of the Auditors for non payment of certain Statutory Dues, the Board of Directors would like to state that due to temporary shortage offunds, the said dues have been remained unpaid. Necessary steps have been taken to make the payment of the said outstanding statutory liabilities. Corporate Governance: A Report on Corporate Governance and Management Discussion & Analysis Report pursuant to Clause 49 of the Listing Agreement are annexed hereto and form part of this report. Particulars of Conservation of Energy, Technology Absorption, Adaptation and Innovation and Foreign Exchange Earnings and outgo: Information relating to the Conservation of Energy, Technology Absorption, Adaptation and Innovation and Foreign Exchange Earnings and Outgo pursuant to Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed hereto and forms part of this report. Particulars of Employees: During the year under review, none of the employees of the Company, whether employed for the whole year or part thereof, was in receipt of remuneration aggregating to or in excess of the limits specified under Section 217(2A)of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, and hence, no particulars of employees are required to be furnished in connection with the said Rules. Acknowledgements: The Board wishes to place on record its sincere appreciation for the continuous support received from Shareholders, Customers, Suppliers, Bankers, Statutory Authorities and all other business associates. The Board also takes this opportunity to thank the employees at all levels for their hard work, commitment and invaluable contribution to the Company's operations. For and on behalf of the Board Rushabh Shah Chairman & Managing Director ANNEXURE TO THE DIRECTORS' REPORT: Information pursuant to Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of the Particulars in the Report of the Board of Directors) Rules, 1988 and forming part of the Directors' Report for the year ended 31st March 2011. I. CONSERVATION OF ENERGY: During the year under review, the Company applied strict control systems to monitor day to day power consumption, to endeavor to ensure the optimal use of energy with minimum wastage for its plant. ENERGY CONSUMPTION: A. Power and Fuel Consumption Year Ended Year Ended 31-03-2011 31-03-2010 1. Electricity Purchased Unit (in kw) 313124 52192 Total Amount (Rs.) 13,99,668 233324 Unit Rate (Rs.) 4.47 4.47 2. L.D.O./F.O. Quantity (in Ltrs) 3,05,000 5473 Total Cost (Rs.) 7,093 1800454 Average rate/liter (Rs.) 43 35.88 B. Consumption per unit of production: Electricity (per MT) 176.86 units 2000 units L.D.O. (per MT) 153.6 units 500 units II. A) RESEARCH AND DEVELOPMENT (R&D): 1. Specific areas in which R&D carried out by the Company.: The Company has set up the facilities to manufacture plastic bags and tarpaulin covers with latest technology machines available in the industry and most suitable in the Indian conditions. During the year under review no R & D activities were undertaken up by the Company but online R&D process is proposed to be implemented to ensure optimum utilization of capacity, best quality output with control over the manufacturing cost. 2. Benefits derived as a result of the above R&D.: Not applicable 3. Future Plan of action: To reduce cost of production and improve quality, it is proposed to carry out Research and Development in several areas with in-house facilities. B) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION: 1. The Company has not acquired any technology for its manufacturing operations. However, the process applied is standard and generally accepted in the Industry. 2. Proper facilities will be set up for quality assurance and checking of various parameters at regular interval. 3. Benefits derived as a result of the above efforts: The Company is expected to achieve consistency in the product quality, cost control, product development, import substitution etc. This will also help to achieve better yields and quality of the end product and the cost reduction. 4. Purchase of technology imported during the last 5 years: Not applicable III. FOREIGN EXCHANGE EARNINGS AND OUTGO: During the year under review the Company did not have any earnings in foreign exchange (Previous Year Rs. Nil). However, the Company recorded foreign exchange outgo of Rs. Nil/- towards foreign traveling. (Previous Year Rs. Nil) For and on behalf of the Board Date : 11th August 2011 Rushabh Shah Place: Mumbai Chairman and Managing Director MANAGEMENT DISCUSSION AND ANALYSIS: Statements in this Report, particularly those which relate to the Company's objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied. (A) Industry structure and developments: Considering the plastic industry, in India, low-density polyethylene (LDPE) and linear low density polyethylene (LLDPE) are widely used polymers. This segment of polymers is growing at the rate of 12% per year. More than 50% of LDPE/ LLDPE is used by the packaging industry. The second most used polymer in India is HDPE, with a share of 22%. The value of its domestic consumption is Rs 2,123 crore and it is growing at the rate of 15% per year. HDPE is used in the manufacturing of raffia, blow molding, injection molding, and in the paper industry as well. The majority of manufacturing capacities are owned by the big industrial houses. Investment in the plastics sector in India is also rising with domestic and overseas companies setting up or expanding manufacturing activities. Further, the Indian government has taken steps to enhance competitiveness of the country's plastic industry by reducing import duties and central excise rates, and introducing value-added tax to replace sales tax. As regards growth in the Plastic Industry, the global consumption of plastic is much more than the consumption of plastics in India. It is expected that consumption of plastics in India is expected to rise within five years and the industry will offer 'unprecedented opportunities' in the next two decades due to rapid urbanization and growth in retail business in India. (B) Opportunities and Threats, Risks and Concerns: The change in business policies, including the relaxation in restrictions on foreign ownership; some privatization of government assets; and tariff reductions, have made the country as competitive as the other Asian regions. Foreign investors view India as a country with enormous potential, hence new foreign and domestic investments in the plastics industry will accelerate competition through higher growth, and measures by the Indian government to encourage investments. It is expected that India's polymers sector will have one of the highest growth rates of any polymer industry over the next 10 years. As per the study carried out for availability of growth of various industries in India, India's petrochemical industry is expected to attract investments of more than $18 billion in the next 4-5 years. About $10 billion of that will be invested in the downstream processing industry and the rest by several existing and new producers. India can become a global production base and an export hub in the coming years. Hence availability of raw materials would be easy and that will further enhance the opportunities for the Plastic Industry which is a by product of petrochemical industry. With more concentration on the specialty grades quality products which are more eco friendly plastic products and moving away from the type of commodity made cheaply will have more scope to survive in the long run considering the environmental issues attached with the Plastic Industry. With the quality consciousness, India can be a competitive supplier to China and to the rest of Asia. The main threat is from the unorganized sector comprising low grade plastic goods manufacturers and from non eco-friendly manufacturing units. This may lead to quality problems in the international market and downgrading of Indian manufacturers' image. Secondly, due to its basic nature and use of low grade of plastic which is not eco-friendly, there has always been a threat of substitution of plastic as basic material with other metal or alternate material. These are the key risk factors which the Plastic Industry has to tackle in future. (C) Internal control systems and their adequacy: The financial year under review being the Second year of operations with the commissioned of own manufacturing department, the Company is in process of designing and putting in place various internal control systems for all the key departments including production, purchase, finance and accounts with specific thrust on the materials wastage, environmental issue, and regular compliances at all level. Going forward, the Company has plans to expand its systems to other departments with recruitment of managerial cadre personnel more exhaustive reporting and rigorous follow up actions wherever any signs of shortcomings. Further Internal Audit systems will also be placed and proposed to be carried out to check the implementation and working of the Internal Systems. (D) Material developments in Human Resources/Industrial Relations front, including number of people employed The Company's industrial relations continued to be harmonious during the Second year of manufacturing activities wherein the Company generated any employment during the year under review. (E) Social Responsibility: The Company is conscious of its obligations towards Health, Safety & Environment to meet the norms of local Pollution Control Board at Silvassa Plant. (F) Cautionary Statement: Statement in the Management discussion & analysis describing the Company's objectives, projections, estimates & exceptions may be 'forward looking statements' within the meaning of applicable securities laws & regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the company's operations include economic conditions affecting demand/ supply and price conditions in the domestic & overseas markets in which the company operates changes in the Government regulations, tax laws & other statutes & other incidental factors. (G) Future Outlook: Company is planning to expand its business by issuing the shares of the Company which forms the Un-issued Capital of the Company, this will enable the Company to have more money to expand its business and avail the emerging opportunities in Plastic Industries. For and on behalf of the Board, Rushabh Shah Chairman & Managing Director Date : 11th August 2011 Place: Mumbai

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