Your Directors are pleased to present their Twenty Fifth Annual Report together withthe Audited Financial Statements of your Company for the financial year ended March 312014.
|FINANCIAL RESULTS || ||(Rs. in Lacs) |
|Particulars ||Current Year 2013-2014 ||Previous Year 2012-2013 |
|revenue from operations ||14487.33 ||9583.03 |
|other Income ||12.55 ||6.89 |
|total income ||14499.88 ||9589.92 |
|profit for the year before Finance costs depreciation Extra ordinary item and tax Expenses ||3284.05 ||616.60 |
|Less : Finance Costs ||108.80 ||159.29 |
|Profit for the year before Depreciation Extra Ordinary Item and Tax Expenses ||3175.25 ||457.31 |
|Less : Depreciation ||119.67 ||118.59 |
|Profit for the year before Extra Ordinary Item and Tax Expenses ||3055.58 ||338.72 |
|Less: Extra Ordinary Item ||159.79 ||- |
|Profit for the year before Tax Expenses ||2895.79 ||338.72 |
|Less: Current Tax ||660.12 ||0.06 |
|Less: Deferred Tax ||231.38 ||(40.67) |
|Net Profit for the year ||2004.29 ||379.33 |
|Add : Balance brought forward from last year ||797.16 ||446.80 |
|Surplus available for Appropriation ||2801.45 ||826.13 |
|Appropriation || || |
|Transfer to General Reserve ||225.00 ||- |
|Proposed Dividend at Rs. 2.00 per Equity Shares ||99.07 ||24.76 |
|Interim Dividend at Rs. 3.00 per Equity Shares ||148.58 ||- |
|Tax on Dividend ||42.08 ||4.21 |
|Balance Carried over to Balance Sheet ||2286.72 ||797.16 |
|Total ||2801.45 ||826.13 |
After considering the Company's profitability cash flow and overall financialperformance your Board of Directors of the company are pleased to recommend a finaldividend of Rs. 2.00 per equity share (20% on the face value of Rs. 10/-each) subject toapproval of the members at the forthcoming Annual General Meeting. which along with theInterim dividend of Rs. 3.00 per equity share (30% on face value of Rs. 10 each) adds upto total dividend of Rs. 5.00 per equity share (50% on face value of Rs. 10 each).
During the previous financial year the company has paid a dividend of Rs 0.50 perequity share (5% on face value of Rs. 10 each).
During the year under review your directors had declared an first interim dividend ofRs. 2.50 per equity share (25% on face value of Rs. 10 each) at its meeting held onNovember 12 2013 and had declared second interim dividend of Rs. 0.50 per equity share(5% on face value of Rs. 10 each) at its meeting held on January 21 2014 respectively andthe same has been paid to the members/beneficial owners as on record date. The members arerequested to approve the interim dividend as final dividend for the financial year2013-14.
The final dividend if declared as above would involve a total outgo of Rs. 247.64 Lacstowards dividend for the year (including interim dividend already paid) and Rs. 42.08 Lacstowards dividend distribution tax (including dividend distribution tax of interimdividend).
The global economic environment during the year 2013-14 continued to be gloomy withslow growth in all emerging markets. The Indian economy also struggled with Industrialgrowth high inflation depreciation of Indian currency high interest cost. Negativebusiness sentiments prevailed throughout the year. despite all challenging macroenvironment your company registered a record performance over previous year.
Results of Operations
During the year under review the company has earned a total income of Rs. 14500 lacsas compared to Rs. 9590 Lacs of the previous year.
Profit after tax (pat) increased from Rs. 379 lacs to Rs. 2004 Lacs during the year.
The total sales increased from Rs. 9020 lacs to Rs. 13897 Lacs during the yearshowing a growth of 54% compared with the previous year.
During the year under review total exports sale increased from Rs. 8125 Lacs to Rs.11678 Lacs compare to the previous year showing a growth of 44%. Your directors areconfident to explore better overseas market in the years to come.
TRANSFER TO RESERVES
Your company proposes to transfer Rs. 225 Lacs to General Reserve (previous year Rs.nil). out of amount available for appropriation and an amount of Rs. 2287 Lacs is proposedto be retained in the Statement of profit and Loss.
SCHEME OF ARRANGEMENT
The Board of directors of the company at its meeting held on 19th december 2013 hasapproved a composite Scheme of Arrangement in the nature of de-merger and transfer of cpcGreen division of Asahi Songwon colors Limited to Aksharchem (India) Limited andconsequential restructure of the share capital of Asahi Songwon colors Limited. The schemeis subject to requisite approvals including sanction of Hon'ble High Court. Theshareholders of the Company present at the Court Convened Meeting held on July 2 2014 andpublic shareholders through voting by postal ballot have approved the said scheme ofarrangement with requisite majority. It is now awaiting sanction of the Court.
MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT
In terms of Clause 49 of the Listing Agreement with the Stock Exchanges a ManagementDiscussion and Analysis Report is appended to this Report.
Your Company is committed to maintain the highest standards of Corporate Governance. Aseparate Corporate Governance Report as stipulated under Clause 49 of the ListingAgreement with the Stock Exchange(s) is furnished as a part of this Report together withcertificate from M/s. Trushit Chokshi & Associates Chartered Accountants Ahmedabadconfirming compliance with the conditions of Corporate Governance.
SECRETARIAL AUDIT REPORT
As required under the provisions of Section of Section 383A of the Companies Act 1956and the rules made there under a certificate is appended herewith and the same forms partof this Report.
Various provisions in respect of Directors contained in the Companies Act 2013("the Companies Act") were notified with effect from April 1 2014 repealing thecorresponding provisions in the Companies Act 1956 ("the 1956 Act").
Mr. Gautam M. Jain and Mr. Jayprakash M. Patel were appointed as additional directorsof the Company with effect from January 21 2014 who hold office until the ensuing AnnualGeneral Meeting.
Section 149 of the Companies Act 2013 stipulates the criteria of independence forappointment of an Independent Director on the Company's Board. An Independent Director canhold office for a term up to 5 (five) consecutive years on the Board of the Company and heshall not be included in the total number of directors liable to retire by rotation. Inthe opinion of the Board Mr. Gautam M. Jain and Mr. Jayprakash M. Patel fulfils theconditions for their appointment as an independent director as specified in the CompaniesAct 2013 read with rules made there under and the Listing Agreement. The Board recommendstheir appointment as independent directors of the Company for your approval.
As per the provisions of Section 149 of the Companies Act 2013 independent directorsshall hold office for a term up to five consecutive years on the board of the Company butshall be eligible for re-appointment for another term up to five years. Further Section152 of the Companies Act 2013 provides that the independent directors shall not be liableto retire by rotation in the Annual General Meeting ("AGM") of the Company.
Mr. kiran J. Mehta and Mr. Param J. Shah retire by rotation at the ensuing AnnualGeneral Meeting under the erstwhile applicable provisions of the Companies Act 1956.Under Section 149 of the Companies Act 2013 and Rules made there under and as per Clause49 of the Listing Agreement an Independent Director now shall hold office for a term of 5(five) consecutive years on rotation. In terms of Section 149 and other applicableprovisions of the Companies Act 2013 and Rules made there under the Board of Directorshave appointed Mr. kiran J. Mehta and Mr. Param J. Shah as Independent Directors of theCompany for a term of 5 (five) consecutive years up to conclusion of the 30th AnnualGeneral Meeting of the Company. The Board recommends passing of resolution.
Dr. Pradeep Jha is Independent Director of the Company whose period of office isliable to determination by retirement of Directors by rotation under the erstwhileapplicable provisions of the Companies Act 1956. Under Section 149 of the Companies Act2013 and Rules made there under and as per Clause 49 of the Listing Agreement anIndependent Director now shall hold office for a term of 5 (five) consecutive years onrotation. In terms of Section 149 and other applicable provisions of the Companies Act2013 and Rules made there under the Board of Directors have appointed Dr. Pradeep Jha asIndependent Director of the Company for a term of 5 (five) consecutive years up toconclusion of the 30th Annual General Meeting of the Company. The Board recommends passingof resolution.
In terms of the provisions of Section 152 of the Companies Act 2013 two third of thetotal strength of the Board (excluding Independent Directors) shall be liable to retire byrotation. one-third of such directors who are liable to retire by rotation shall retire atevery Annual General Meeting. The Board of Directors of your Company at present consistsof three (3) Non-Independent Directors. In the light of above referred provisions of theCompanies Act 2013 it is desirable that the period of office of Executive Directors ismade liable to determination by retirement of directors by rotation. Accordingly Mrs.Paru M. Jaykrishna Chairperson and Managing Director of the Company Mr. Gokul M.Jaykrishna Joint Managing Director of the Company and Mr. Munjal M.
Jaykrishna Joint Managing Director of the Company retire by rotation. Accordingly theBoard of Directors has revised terms of appointment in line with the above however otherterms of appointment aforesaid executive directors remain the same and there is no breakin their employment. The Company seeks your approval for the variation in terms ofappointment of the executive directors.
Out of three non - independent directors two directors shall be liable to retire byrotation and one of them (ie.1/3rd) will retire every year starting from Annual GeneralMeeting 2014. Mrs. Paru M. Jaykrishna being the longest severing director in thiscategory shall retire by rotation in the ensuring Annual General Meeting of the Company.Mrs. Paru M. Jaykrishna being eligible offers herself for reappointment as director andthe Board recommends her reappointment in the ensuing Annual General Meeting.
The Board of Directors at its meetings held on January 21 2014 revised theremuneration payable to Mrs. Paru M. Jaykrishna Chairperson and Managing Director of theCompany. Further in the Board Meeting held on August 12 2014 has revised theremuneration of Mrs. Paru M. Jaykrishna. The Board recommends passing of resolution.
The Board of Directors at its meetings held on January 21 2014 revised theremuneration payable to Mr. Gokul M. Jaykrishna Joint Managing Director of the Company.Further the Board of Directors of the Company has revised the terms of appointment of Mr.Gokul M. Jaykrishna. The Board recommends passing of resolution.
The Board of Directors at its meeting held on January 21 2014 revised the remunerationpayable to Mr. Munjal M. Jaykrishna Joint Managing Director of the Company. Further theBoard of Directors at its meeting held on March 24 214 has reappointed Mr. Munjal M.Jaykrishna as Joint Managing Director of the Company for a further period of 5 yearssubject to approval of shareholders at the ensuing Annual General Meeting. The Company isseeking your approval for his reappointment.
Attention of the Members is invited to the relevant items in the notice of the AnnualGeneral Meeting for seeking your approval for approval for aforesaid appointments. Theinformation required under Clause 49 of the Listing Agreement is given in the Notice andthe Explanatory Statement annexed thereto of the 25th Annual General Meeting as perSection 102 of the Companies Act 2013.
The composition of the Board of Directors of the Company includes a women director viz.Mrs. Paru M. Jaykrishna. Accordingly the Company is in compliance with the requirement ofSection 149(1) of the Companies Act 2013 read with Rule 3 of the Companies (Appointmentand Qualification of Directors) Rules 2014.
DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the requirement under Section 217(2AA) of the Companies Act 1956the Directors hereby confirm that:
(i) in the preparation of the annual accounts for the year ended March 31 2014 theapplicable accounting standards have been followed along with proper explanations in caseof material departures;
(ii) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe Statement of profit and loss of the Company for the year under review;
(iii) the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 1956for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; and
(iv) the directors had prepared the annual accounts on a going concern basis.
AUDITORS AND AUDITORS' REPORT
The observations of the Auditors made in the Auditors Report are self explanatory. TheStatutory Auditors of the Company M/s. Trushit Chokshi & Associates CharteredAccountants Ahmedabad (Firm Registration No.1 1 1072W) hold office until the conclusionof the ensuing Annual General Meeting. Your Company has received intimation to the effectthat the proposed reappointment if made would be within the prescribed limit underSection 141 of the Companies Act 2013 and Rules made there under. Further theappointment will have to be in terms of provisions of Section 141 of the Companies Act2013.
The said Auditors have confirmed their willingness to accept office if reappointed.The Board on the recommendation of the Audit Committee have proposed the reappointment ofM/s. Trushit Chokshi & Associates Chartered Accountants Ahmedabad (Firm RegistrationNo.1 1 1072W) Statutory Auditors of the Company to hold office from the conclusion ofthis Annual General Meeting till the conclusion of the 28th Annual General Meeting - threeyears (subject to ratification of the appointment by the members at every Annual GeneralMeeting held after this Annual General Meeting) at such remuneration to be decided by theBoard of directors in consultation with the said Auditors.
The notes on financial statement referred to in their Audit Report are self explanatoryand do not call for any further explanation.
The Company has not accepted deposit from public during the year and there was nodeposit outstanding on March 31 2014.
PARTICULARS OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO
The particulars of conservation of energy technology absorption and foreign exchangeearnings and outgo pursuant to provisions of Section 217 (1) (e) of the Companies Act1956 read with the Companies (disclosure of particulars in the Report of Board ofdirectors) Rules 1988 are provided in the Annexure - "A" to this Report.
STATEMENT OF EMPLOYEES' PARTICULARS
The particulars of employees as required under Section 217(2A) of the Companies Act1956 read with the Companies (Particulars of Employees) Rules 1975 as amended is attachedherewith as per Annexure - "B" forming part of this Report.
The Board of directors of the Company on the recommendation of the Audit Committee havereappointed Ms. Stuti R. Shah Cost Accountants as the Cost Auditors to audit the costrecords maintained by your Company for the financial year 2014-15 on remuneration Rs.20000/- (Rupees Twenty Thousand only) plus service tax and out of pocket expenses atactuals. As per Rule 14 of the Companies (Audit and Auditors) Rules 2014 the appointmentand remuneration payable to the Cost Auditors is to be ratified by the shareholders andthe same is given in the notice and explanatory statement annexed thereto of the 24thAnnual General Meeting as per Section 102 of the Companies Act 2013. The Cost Report forthe year 2012-13 was filed in due time.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
Overall industrial relations of the Company during the year were cordial. Yourdirectors wish to place on record their sincere appreciation for the devoted services ofall the employees and workers of the Company.
FINANCE AND INSURANCE
The Company has been financed by State Bank of India for working capital.
All insurable interests of the Company including plant and machinery buildingstocks vehicles stores and spares have been adequately insured against various risks andperils.
The CARE has revised care rating of the Company from "CARE BBB-" (Triple BMinus) to "CARE BBB + " (Triple B Plus) assigned to the long term bankloans/facilities. The CARE also revised from "CARE A3" (A Three) to "CAREA2" (A Two) rating assigned to the short term bank loans/facilities.
The Equity Shares of the Company continue to be listed on BSE Limited and AhmedabadStock Exchange Limited and Listing Fees for the year 2014-15 has been paid to them.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
As provided in Section 205C(2) of the Companies Act 1956 dividend amount which wasdue and payable and remained unclaimed and unpaid for a period of seven years has to betransferred to Investor Education & protection Fund.
The Company has transferred an amount of Rs. 136584/-remaining unclaimed wastransferred to Investor Education and protection Fund (IEpF) during the year.
ENVIRONMENT SAFETY AND HEALTH
Your Company continues to exercise persistent and meticulous efforts towards greenerearth and environment conservation. The Company preserves in its efforts to teach safe andenvironmentally accountable behavior in every employee as well as its vendors. TheCompany is committed towards safety not only of its own men and plant but also of thesociety at large.
Solid waste generated at the Works after treatment of its liquid effluent is shiftedto a Gujarat Pollution Control Board (GPCB) approved site.
The Company continues to demonstrate its commitment to a clean and safe environment.The State of the art effluent treatment plant continues to run satisfactorily so that thetreated wastewater discharged is well within the stipulated norms set by GPCB.
Your Company has ISO 14001:2004 and ISO 9001-2008 certification for its unit.
APPRECIATION AND ACKNOWLEDGEMENTS
Your Directors are grateful and pleased to place on record their thanks to Governmentof India Government of Gujarat Electricity supply companies and Bankers for theirexcellent support guidance and continued cooperation.
The Company is thankful to the shareholders for reposing trust in the Company and theirunflinching enthusiasm and patronage.
By the Order of the Board of Directors
|Place : Ahmedabad ||Mrs. Paru M. Jaykrishna |
|Date : August 12 2014 ||Chairperson and Managing Director |
|Registered Office : ||DIN No. 00671721 |
|166-169 Village Indrad || |
|kadi - kalol Road Dist : Mehsana || |
|Gujarat - 382 715 (India) || |
|CIN : L24110GJ1989PLC012441 || |
ANNEXURE TO THE DIRECTORS' REPORT
Additional information pursuant to Section 217(1)(e) of the Companies Act 1956 readwith Companies (Disclosure of Particulars in the Report of Board of Directors) Rule 1988and forming part of the Directors' Report for the year ended March 31 2014.
I. (A) ENERGY CONSERVATION MEASURES TAKEN DURING THE YEAR 2013-14
|a. ||Energy conservation measures taken ||The Company put continues efforts to energy conservation and its utilization. Efforts are taken to upgrade the plant and machinery. Replacement of motors with energy efficient ones and with appropriate capacities. Replacement of pumps with appropriate and efficient pumps. The Company has three DG set of one 750 kVA and two 125 kVA installed in the plant as standby for continuous power supply. |
|b. ||Additional investments and proposals if any being implemented for reduction of consumption of energy ||No |
|c. ||Impact of measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods ||The adoption of energy conservation measures indicated above has resulted in awareness amongst the employees and shall have impact on savings of extra costs on energy. The Company is constantly exploring avenues of cost saving as an on going process. |
|d. ||Total energy consumption and energy consumption per unit of production ||As per Form A |
|Sr. No. ||Particulars ||Unit of Measurement ||2013-14 ||2012-13 |
|A) ||POWER & FUEL CONSUMPTION || || || |
| ||1. Electricity || || || |
| ||a. Purchased || || || |
| ||Unit ||Lacs KWH ||65.14 ||70.11 |
| ||Total amount ||Rs in Lacs ||456.18 ||416.80 |
| ||Rate/Unit ||Rupees ||7.00 ||5.94 |
| ||b. Own Generation || || || |
| ||i) Unit generated through diesel generator ||Lacs KWH ||NA ||NA |
| ||Unit per litre of diesel oil ||Rs in Lacs ||NA ||NA |
| ||Cost/Unit ||Rupees ||NA ||NA |
| ||2. Diesel/Furnace Oil || || || |
| ||Unit ||Thousand Ltrs ||88.96 ||54.32 |
| ||Total amount ||Rs in Lacs ||50.70 ||26.21 |
| ||Rate/Unit ||Rupees ||56.99 ||48.25 |
| ||3. Lignite Coal & other Fuels || || || |
| ||Unit ||Thousand kgs ||11301.39 ||5286.70 |
| ||Total amount ||Rs in Lacs ||513.79 ||196.12 |
| ||Rate/Unit ||Rupees ||4.54 ||3.71 |
|B) ||CONSUMPTION PER UNIT OF PRODUCTION || || || |
| ||Electricity ||(Units/Ton) ||1115.71 ||1242.63 |
| ||Diesel/furnace oil ||(Ltrs./Ton.) ||15.23 ||9.63 |
| ||Lignite Coal and other fuels ||(kg/ton) ||1935.70 ||937.02 |
B. TECHNOLOGY ABSORPTION
Efforts made in Technology Absorption in Form "B"
RESEARCH & DEVELOPMENT (R & D) FORM "B"
1. Specific area in which Research and Development carried out by the Company
The Research and Development department continued to direct its efforts towards qualitycontrol cost reduction and improvement of product as per customer demand.
2. Benefits derived as a result of the above Research & Development
Research and Development work in enrichment of the Company's product range withpromising new products and higher value addition due to cost reduction by way of processimprovements energy savings and reduction of chemical waste.
With installation of Quality System and Total Quality Management we have beenable to get ISO 9001:2008 accreditation and this is in turn has enabled us to planmanufacture and supply material of International Standards. This activity has resulted inup gradation of all the documentation on the products to specify complete manufacturingand quality assurance needs.
The company has received ISO 14001-2004 Certification.
3. Future plan of action
The Company plans to continue its efforts on in-house Research and Development toimprove quality of existing product and developing of new products.
|4. Expenditure on Research & Development || ||(Rs. in Lacs) |
|Particulars ||2013-2014 ||2012-2013 |
|Capital ||Nil ||0.63 |
|Revenue/Recurring ||5.61 ||3.19 |
|Total ||5.61 ||3.82 |
|Total Expenditure as % of turnover ||0.04% ||0.04% |
5. Technology absorption adaptation and innovation
i) Efforts in brief made towards technology absorption adaptation and innovation:
The Company has been putting emphasis to train its technical personnel by way ofproviding training to them for the latest technology available.
ii) Benefits derived as a result of the above efforts:
Benefits derived from these efforts include process rationalization product qualityimprovement reduced wastage and overall cost reduction.
iii) In case of imported technology (imported during the last 5 years reckoned from thebeginning of the financial year) following information may be furnished:
|a. Technology imported ||Nil |
|b. Year of Import ||Not Applicable |
|c. Has technology been fully absorbed? ||Nil |
c. FOREIGN EXCHANGE EARNINGS AND OUT GO
a. Activities relating to Exports initiative taken to increase exports development ofnew export markets for products and service and export plans.
The Company exports its product to Taiwan South korea and other Countries. The Companyhas continued to maintain focus and avail of export opportunities based on economicsituation. During the year the Company exported Vinyl Sulphone valuing to Rs. 11662 Lacs(Previous Year Rs. 8109 Lacs) to various countries around the World. Continuous effortsare being taken to increase exports by exploring new markets.
|b. Foreign Exchange used and earned || ||(Rs. in Lacs) |
|Particulars ||2013-2014 ||2012-2013 |
|Foreign Exchange Earned ||11661.79 ||8109.25 |
|Foreign Exchange Used ||20.29 ||14.78 |
ANNEXURE - "B" TO THE DIRECTORS' REPORT
Particulars of Employees as per Section 217(2A) of the Companies Act 1956 and therules made therein and forming part of the Director's Report for the year ended March 312014.
|Name ||Designation ||Remuneration received Rs in Lacs ||Qualification ||Experience (Years) ||Date of commencement of Employment ||Age (Years) ||Previous Employment held |
|Mrs. Paru M. Jaykrishna ||Chairperson and Managing Director ||72.37 ||MA LLB ||44 ||Since Inception ||71 ||Skyjet Aviation Pvt Ltd |
|Mr. Gokul M. Jaykrishna ||Joint Managing Director ||70.15 ||Major in Finance & Marketing ||24 ||1994 ||46 ||krieger Associates New Jersey USA |
|Mr. Munjal M. Jaykrishna ||Joint Managing Director ||70.13 ||Major in Finance & Marketing ||23 ||1995 ||44 ||Bank of California San Francisco USA |
1. The employment is contractual.
2. Remuneration received includes Salary Commission Company's contribution toProvident Fund and taxable value of Perquisites.