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Birla Cotsyn India Ltd.

BSE: 533006 Sector: Industrials
NSE: BIRLACOT ISIN Code: INE655I01024
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VOLUME 2843468
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Mkt Cap.(Rs cr) 26.69
Buy Price 0.11
Buy Qty 2298487.00
Sell Price 0.00
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Birla Cotsyn India Ltd. (BIRLACOT) - Director Report

Company director report

To the Members

The Directors have pleasure in presenting the Seventy Third Annual Report along withthe Audited Accounts of the Company for the year ended 31st March 2015.

1. Financial Results

(Amt in Rs)
Particulars Consolidated Standalone
Year ended 31-03-2015 9 month period ended 31.03.2014 Year ended 31-03-2015 9 month period ended 31.03.2014
Revenue from Operations 1522074110 1274180226 1124502678 936275688
Other Income 31898534 39840969 31898534 39833321
Total Income 1553972644 1314021195 1156392646 976109009
PBDIT (986589524) (119441.341) (969303670) (105632866)
Interest and Finance Expenses 535100355 364962878 534623811 364658179
PBDT (1521689879) (484404219) (1503927482) (470291045)
Depreciation 137393177 75284470 137264583 75185782
PBT (1659083056) (559688689) (1641192335) (545476827)
Less: Deferred Tax Liability/(Asset) 2918260 - 2918260 -
PROFIT AFTER TAX (PAT) (1662001316) (559688689) (1644110595) (545476827)
Profit transferred to Reserves (1662001316) (559688689) (1644110595) (545476827)

2. Operating and Financial Performance

Since last few years textile industry is passing through very difficult businessconditions. The general business environment continued to be challenging due to theuncertain global economic scenario. The major challenge of textile industry is facing byincreasing cost of production arising out of rising wages high power cost etc and excesscapacity installed in the cotton yarn industry. This led to lower margins as the Companycould not pass on higher costs to customers. The exports during the year ended are notsignificant since the ruling prices of export continued to be non remunerative for ourtype of products and China all of sudden stopped buying cotton yarn from India. Furtherduring the year ended the cotton yarn scenario continues to remain in pressure due to weakdomestic textile market which has further resulted into severe pressure on the margins.During the year under review turnover of your Company is Rs. 1124502678/- as comparedto the turnover of Rs.936275688/- during previous accounting period of 9 months. Theloss of your Company has increased to Rs.1641192335/- during the year under reviewcompared to net loss of Rs. 545476827 in previous accounting period of 9 months due toadverse market conditions and global recession and also due to provision of unrecoverablecapital advances / writing off capital work in progress in respect of projects which couldnot take off. Your company is relentlessly putting all its efforts to reduce the cost andimprove the operating margins but the profit of the company is still negative during thecurrent financial year. However despite all adverse features Company is continuing itsefforts to explore opportunities for its products in overseas markets but insufficientresources is not allowing to reap the benefits to its fullest extent.

3. Erosion of Net-Worth – Reference to BIFR

Due to continuous losses the audited accounts for the financial year 2014-15 showsa total accumulated losses of Rs.1641192335/- which exceeds the entire net worth ofRs.246770632/- of the Company. As the net–worth of the Company has eroded at theend of the Financial year 31st March 2015 the Company has become a SickIndustrial Company in term of section 3(1)(0) of the Sick Industrial Companies (SpecialProvisions) Act 1985 (SICA). Accordingly the Board of Directors of the Company hasopinion to make a reference to the Board for Industrial and Financial Reconstruction(BIFR) as required under the provisions of SICA for determination whether the Company is asick industrial company or not.

4. Dividend

In view of loss suffered by the Company your Directors have not recommended anydividend for the financial year ended 31st March 2015.

5. Increase in Share Capital

There has been no change in the Share Capital of the Company.

6. Employee Stock Options Plan

The Company had authorized an Employee Stock Option Plan 2007 (ESOP) in theirExtraordinary General Meeting held on 6th December 2007. No shares have beenallotted under the ESOP till date. The Company has not granted any stock options duringthe financial year ended 31st March 2015.

7. Listing

The Equity Shares of the Company continue to remain listed with Bombay Stock ExchangeLimited and National Stock Exchange of India Limited.

8. Subsidiary Company

The Company has one wholly owned subsidiary at UAE in the name of Birla Cotsyn (India)Limited FZE which has been setup to develop the overseas market for the Company. TheAudited Accounts for the wholly owned Subsidiary Company Birla Cotsyn (India) Ltd FZEhave been received by the Company and a statement pursuant to section 129 of the CompaniesAct 2013 forms part of this Annual Report. Your Directors have pleasure in enclosing theconsolidated financial statements of the Company in accordance with the listing agreementand Accounting standards issued by the Institute of Chartered Accountants of India.

In compliance with the general circular issued by Ministry of Corporate Affairs (MCA)Government of India the Balance Sheet Statement of Profit & Loss and other documentsof the subsidiary are not attached hereto. As per the general exemption a statementcontaining brief financial details of the Company’s subsidiary for the year ended 31stMarch 2015 is included in this Annual Report. The Annual Accounts of the subsidiary andthe related detailed information will be made available to any Member of the Company/itssubsidiary seeking such information at any point of time and are also available forinspection by any Member of the Company/its subsidiary at the Registered Office of theCompany/its subsidiary.

9. Management Discussion and Analysis and Corporate Governance Report

In compliance with Clause 49 of the Listing Agreement with Bombay Stock ExchangeLimited and National Stock Exchange of India Limited a separate section on ManagementDiscussion and Analysis Report which also includes further details on the state of affairsof the Company and Corporate Governance Report as approved by the Board of Directorstogether with a certificate from the Practicing Company Secretary confirming thecompliance with the requirements of Clause 49 forms part of this Annual Report.

10. Corporate Governance Report

A report on Corporate Governance along with the Compliance Certificate from theAuditors is annexed hereto and forms part of this report.

11. Directors Responsibility Statement

Pursuant to Section 134(5) of the Companies Act 2013 the Directors of the Companystate as under that:

1. In the preparation of the annual accounts the applicable Accounting Standards hadbeen followed along with proper explanation relating to material departures;

2. The selected accounting policies were applied consistently and the Directors madejudgments and estimates that are reasonable and prudent so as to give true and fair viewof the state of affairs of the Company for the financial year ended 31st March2015 and the Loss of the Company for the financial year ended 31st March 2015.

3. Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safe guardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

4. The annual accounts have been prepared on a ‘going concern’ basis;

5. Internal financial controls had been laid down to be followed by the company andthat such internal financial controls are adequate and were operating effectively; and

6. Proper systems had been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

12. Board of Directors Evaluation Etc.

Appointment / Resignation of Directors

Shri Sanjay Rane and Smt. Nirmala Mathur are appointed as Additional Directors by theBoard of Directors of the Company at its meeting held on 27th May 2015. Theiroffice expires at the ensuing Annual General Meeting and the Company has received noticeunder section 160 of the Companies Act 2013 proposing their candidature for Directorshipalong with the deposit as prescribed thereunder. They are eligible for being appointed asDirectors at the ensuing Annual General Meeting and it is proposed to appoint Shri SanjayRane as an Independent Director with a fixed tenure of 5 (five) years subject to approvalof shareholders at the ensuing general meeting in term of Section 149 of the CompaniesAct 2013. Further it is proposed to appoint Smt. Nirmala Mathur as Non-IndependentNon-Executive Director liable to retirement by rotation subject to approval ofshareholders at the ensuing general meeting in term of Section 160 of the Companies Act2013.

Shri Rakesh Kumar Dixit Director of the Company retires by rotation and beingeligible offers himself for re-appointment.

Shri Jignesh Mehta Shri Ram Prakash Mishra and Shri Vinod Kumar Kapur resigned asIndependent Directors of the Company. The Board noted their resignation w.e.f 27thMay 2015 and placed on record their sincere appreciation of the service rendered by themduring their tenure with the Company.

Company’s Policy on Directors Appointment and Remuneration etc.

The Company has prepared a policy on Director’s appointment and remunerationpursuant to Section 178 of the Act. The Company has also laid down criteria fordetermining qualifications positive attributes and independence of Director.

Formal Annual Evaluation

The Formal Annual Evaluation has been made as follows:

a. The Company has laid down evaluation criteria separately for Board IndependentDirectors Directors other than Independent Directors and various committees of the Board.The criteria for evaluation of Directors included parameters such as willingness andcommitment to fulfill duties high level of professional ethics contribution duringmeetings and timely disclosure of all the notice/details required under various provisionsof laws. Based on such criteria the evaluation was done in a structured manner throughpeer consultation & discussion.

b. Evaluation of the Board was made by a Separate Meeting of Independent Directors heldunder Chairmanship of Shri. Satyanarayan Baheti Independent director (without attendanceof non – Independent Director and members of management).

c. The performance evaluation of all committees were done by the Board of Directorsnamely:

i. Audit Committee

ii. Nomination and Remuneration Committee

iii. Stakeholders Relationship Committee

d. Performance evaluation of non – Independent Directors was done by Separatemeeting of Independent Directors.

e. Evaluation of Independent Directors was done (excluding the Director who wasevaluated) by the Board of Directors of the Company.

f. In addition the Nomination and Remuneration Committee has carried out evaluation ofevery Director’s performance as required under Section 178 (2) of Companies Act2013.

g. The Directors expressed their satisfaction with the evaluation process.

Key Managerial Personnel

During the year Shri. Vipin Varkhawat Chief Financial Officer of the Company wasdesignated as Key Managerial Personnel under Section 203 of the Companies Act 2013.

Further Shri Satya Kishore Mathur who was already a Manager of the Company and Ms.Vineeta Shah who was working as the Company Secretary were designated as Key ManagerialPersonnel’s (KMPs) of the Company under the above mentioned provisions of CompaniesAct 2013 in their respective positions.

In compliance with the Clause 49 IV (G) of the Listing Agreement brief resume of theaforesaid Directors their expertise and other details of Directors proposed to beappointed/ re-appointed are provided in the Corporate Governance Report. Appropriateresolutions for appointment/ re-appointment of the aforesaid Directors are being placedfor approval of the members at the ensuing Annual General Meeting.

13. Fixed Deposits

1. Deposits Accepted during the year NIL
2. Deposits remained unpaid or unclaimed as at end of the year Rs. 70856978/-

 

3. Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so number of such cases and the total amount involved: Principal Interest
i. At the beginning of the year Rs. 22957000 Rs. 16130872
ii. Maximum during the year Rs. 43329363 Rs. 19426451
iiii. At the end of the year Rs. 43329363 Rs. 19426451
4. The details of deposits which are not in compliance with the requirements of Chapter V of the Act Not Applicable

The Company has filed a petition for sanctioning the scheme for rescheduling the periodof repayment of Fixed Deposits and payments of interest before the Company Law BoardWestern Region Mumbai and the Company Law Board has passed order dated 19thMay 2015 for rescheduling the repayment of Fixed Deposits for a specified period underSection 58A(9) of the Companies Act 1956 read with Section 74(2) of the Companies Act2013. The Company is now making payment to the Fixed Deposit holders as per the orderdated 19th May 2015 passed by the Company Law Board and also pursuant toorders passed by the Company Law Board from time to time to whom Fixed Deposit holdershave approached for making payment of their Fixed Deposits. Further Company is also makingpayment on compassionate ground to all Fixed Deposit holders who are approaching theCompany looking to their genuine needs.

14. Related Party Transactions

There are no related party contracts arrangements or transactions of the naturementioned in sub-section (1) of Section 188 of the Companies Act 2013 which are not atarm’s length and during the year under review the Company did not enter into anyrelated party contracts arrangements or transactions which are at arm’s length.

15. Extract of Annual Return

Extract of Annual Return in Form MGT – 9 is attached as ‘Annexure A’to this Report.

16. Vigil Mechanism

The company has a vigil mechanism named Whistle Blower Policy to deal with instances offraud and mismanagement.

17. Significant and Material Orders Passed by the Regulators or Courts

There are no significant material orders passed by the Regulators/Courts which wouldimpact the going concern status of the Company and its future operations.

18. Auditors

Statutory Auditors

M/s. Samria & Co. Chartered Accountants Mumbai Statutory Auditors of theCompany holds office until the conclusion of the ensuing Annual General Meeting and areeligible for re-appointment. The Company has received a letter from M/s. Samria & Co.Chartered Accountants to the effect that their appointment if made would be within theprescribed limits under Section 139 & 141 of the Companies Act 2013.

Members are requested to re-appoint M/s. Samria & Co. Chartered Accountants as theStatutory Auditors of the Company.

Cost Auditors

The Board has subject to the approval of Central Government approved the appointment ofM/s. M. Goyal & Co. Cost Accountants as Cost Auditors of the Company for conductingCost Audit of Malkapur Textile unit for F.Y. 2015-16 as required pursuant to section 148of the Companies Act 2013 read with the rules made thereunder and the order No. F. No.52/26/CAB/2010 dated 24th January 2012 of the Government of India Ministry ofCorporate Affairs and for issuance of Compliance Report pursuant to the Companies (CostAccounting Records) Rules 2011.

Secretarial audit

Secretarial Audit Report dated 30th June 2015 by Roy Jacob & Co.Practicing Company Secretary (CP no.8220) is attached herewith as ‘Annexure B’to this Report. The report does not contain any qualification.

19. Auditors Remarks

Explanation for the Qualified Opinion of the Auditors report.

1. The Company has not obtained the confirmation from all the ICD parties as all theICD parties have filed legal cases against the Company including winding up petitions forrecovery of their dues. The Company is contesting all the legal cases and also trying forout of court settlement by way of reschedulement concessions or one time settlement.

2. The Company is in process of getting confirmation of dues of related parties.

3. Over the past few years the Company has been providing for interest receivable onloans given to related parties. However none of the related party has paid the interestamount to the Company resulting in unrealized income which further increases thereceivable amount from the parties. Similarly the Company has not been paying interest onloan taken from related parties in view of its default on repayment of dues to financialinstitutions and the need to preserve the scarce working capital resources. As such themanagement has decided that it is prudent and conservative to not provide for suchinterest receivable and payable from the related parties till such time as they aresettled in cash.

4. The Company has filed a petition before the Company Law Board Mumbai forreschedulement of re-payment of fixed deposits and interest thereon. The Hon’bleCompany Law Board has passed an order dated 19th May 2015 for rescheduling therepayment of the fixed deposits and interest thereon for a specified period. The Companyis now making payments as per order dated 19th May 2015.

5. The Company has made provision for capital advances given to various equipmentsuppliers and other parties mainly towards implementing the Weaving Project and otherprojects which have not taken off. The parties are neither giving confirmation ofoutstanding amount nor repaying the advance amount. The Company is pursuing with thevendors for recovery of such advances. Pending such recovery out of prudence the Companyhas decided to make provision for such advances totaling to Rs.943223851/-. In additionthe Company had also incurred certain expenses for the above weaving project which hadbeen capitalized. Given that the Company does not plan to pursue the project suchexpenses amounting to Rs.46200730/- have been written off.

6. The Company is trying to obtain confirmation / reconciliation of such loans. TheCompany is confident of recovery of the loan amount from all the related parties.

7. One factory unit of the Company is operating at low capacity due to shortage of needbased working capital as bankers have stopped providing working capital facility as theirworking capital accounts have become Non Performing Assets. As per valuation carried outby bankers there is no diminution in the value of fixed assets of this unit. Otherobservations made in Auditors’ Report together with relevant notes are selfexplanatory and hence do not call for any further comments under section 134 of theCompanies Act 2013.

20. Particulars of Loans Guarantees and Investments

During the year under review the Company has not given loans guarantees orinvestments under Section 186 of the Companies Act 2013. The details of the investmentsmade by the Company are provided in the accompanying financial statements.

21. Employees’ Safety

The Company is continuously endeavoring to ensure safe working conditions for all itsemployees.

22. Disclosure under the Sexual Harassment of Women at Workplace (PreventionProhibition And Redressal) Act 2013

The Company has in place a Policy for Prevention Prohibition and Redressal of SexualHarassment at work place which is in line with the requirements of the Sexual Harassmentof women at the Workplace (Prevention Prohibition & Redressal) Act 2013 and Rulesmade thereunder. All employees (permanent contractual temporary and trainees) arecovered under this policy. The Company has constituted an Internal Complaint Committee forits Head Office and branch/sales offices under Section 4 of the captioned Act. Nocomplaint has been filled before the said committee till date.

23. Disclosure under Rule 5(1) of the Companies (Appointment And Remuneration) Rules2014

The information required pursuant to Section 197 read with Rule 5(1) of the Companies(Appointment and Remuneration) Rules 2014 in respect of employees of the Company andDirectors is attached as ‘Annexure C’.

24. Particulars of Employees

There were no employees receiving remuneration above the prescribed limit in terms ofRule 5(2) of the Companies (Appointment and Remuneration) Rules 2014 during the yearended 31st March 2015.

25. Particulars of Conservation of Energy Technology Absorption and Foreign Exchangeearnings and outgo

The particulars relating to energy technology absorption and foreign exchange earningsand outgo as required to be disclosed under Section 134 (3)(m) of the Companies Act 2013read with Rule 8 (3) of the Companies (Accounts) Rules 2014 are provided in‘Annexure D’ to Directors Report.

26. Personnel

Your Directors place on the record their appreciation of the contribution made by theemployees at all levels who through their competence diligence solidarity co-operationand support have enabled the Company to achieve the desired results during the period.

27. Acknowledgements

The Board of Directors wishes to acknowledge the invaluable support extended to theCompany by the Government of Maharashtra Bankers Vendors Suppliers Shareholders andCustomers.

For and on behalf of the Board of Directors
Place: Mumbai S. N. BAHETI R. K. DIXIT
Date: 22nd July 2015 Director Director

ANNEXURE B Form No. MR-3 SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31st March 2015

[Pursuant to section 204(1) of the Companies Act 2013 and rule No.9 of the Companies(Appointment and Remuneration Personnel) Rules 2014]

To

The Members Birla Cotsyn (India) Limited

I/We have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Birla Cotsyn (India) Limited(hereinafter called the company). Secretarial Audit was conducted in a manner thatprovided me/us a reasonable basis for evaluating the corporate conducts/statutorycompliances and expressing my opinion thereon.

Based on my/our verification of the books papers minute books forms and returnsfiled and other records maintained by the company and also the information provided by theCompany its officers agents and authorized representatives during the conduct ofsecretarial audit I/ We hereby report that in my/our opinion the company has during theaudit period covering the financial year ended on 31st March 2015 compliedwith the statutory provisions listed hereunder except which are specifically mentionedtherein and also that the Company has proper Board-processes and compliance- mechanism inplace to the extent in the manner and subject to the reporting made hereinafter:

I/we have examined the books papers minute books forms and returns filed and otherrecords maintained by the Company for the financial year ended on 31st March2015 according to the provisions of:

(i) The Companies Act 2013 (the Act) and the rules made thereunder;

a) Company has filed forms with additional (late payment) fees in the provisions ofSection 168 (2) and Section 170(2) of the Act.

b) Company has not complied with the provisions of section 203(4) in respect ofappointment Chief Financial Officer. However the Chief Financial officer was appointedw.e.f 14th November 2014.

c) Company has not complied with the provisions of Section 149(2) (b) in respect of theappointment of Women Director during the Audit period. However Woman Director wasappointed w.e.f 27th May 2015.

d) Default under section 58A of the Companies Act 1956 for non-payment of deposit andinterest thereon is continuing during the period of Audit also. The Company Law Board hadpassed various orders under section 58 A(9) of the Companies Act 1956 including theorder vide order No. CLB/MB/2013/3274 dated 12th December 2013 reschedulingthe repayment of Fixed Deposits and the Company had complied with the said order.

(ii) The Securities Contracts (Regulation) Act 1956 (‘SCRA’) and the rulesmade thereunder;

(iii) The Depositories Act 1996 and the Regulations and Bye-laws framed thereunder;

(iv) Foreign Exchange Management Act 1999 and the rules and regulations madethereunder to the extent of Foreign Direct Investment Overseas Direct Investment andExternal Commercial Borrowings: Not applicable to the Company during the Auditperiod

(v) The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 (‘SEBI Act’) and which are applicable to thecompany:-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992;

(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009: Not Applicable to the Company during the AuditPeriod

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999: Not Applicable to the Companyduring the Audit Period.

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008 : Not Applicable to the Company during the Audit Period

(f) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client.

(g) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009: : Not Applicable to the Company during the Audit Period

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998: : Not Applicable to the Company during the Audit Period

I/we have also examined compliance with the applicable clauses of the following: (i)Secretarial Standards issued by The Institute of Company Secretaries of India.

(Not notified hence not applicable to the Company during the audit period).

(ii) The Listing Agreements entered into by the Company with BSE Ltd.

1. Not Complied with Clause 38 of the listing agreement regarding payment of listingfees.

Based on our such examination and further based on the Representation of the Managementof the Company the Company has during the period under review complied with theprovisions of the Act Rules Regulations Guidelines Standards etc. mentioned aboveexcept the non compliances given in respective paragraphs.

I/we further report that

The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. The changes in thecomposition of the Board of Directors that took place during the period under review werecarried out in compliance with the provisions of the Act. Adequate notice is given to alldirectors to schedule the Board Meetings agenda and detailed notes on agenda were sent atleast seven days in advance and a system exists for seeking and obtaining furtherinformation and clarifications on the agenda items before the meeting and for meaningfulparticipation at the meeting. Majority decision is carried through while the dissentingmembers’ views are captured and recorded as part of the minutes.

I/we further report that there are adequate systems and processes in the companycommensurate with the size and operations of the company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.

For Roy Jacob & Co
Company Secretary
(Roy Jacob)
Proprietor
Place: Mumbai ACS No.18815
Date: 22/07/2015 C P No.: 8220

ANNEXURE C

DISCLOSURE UNDER RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION) RULES 2014

1. The ratio of remuneration of each director to the median remuneration of theemployee and percentage increase in remuneration of Director CFO and CS.

Sr. No. Name Designation Remuneration paid for FY 2014-15 Remuneration paid for FY 2013-14 (for 9 Months) % increase in remuneration in the FY 2014-15 Ratio/Times per median of employee remuneration
(Rs.) (Rs. ) (Rs.)
1. Shri Rakesh Kumar Dixit Director - - - -
2. Shri Ram Prakash Mishra Director - - - -
3. Shri Vinod Kumar Kapur Director - - - -
4. Shri Jignesh Mehta Director - - - -
5. Shri Satyanarayan Baheti Director - - - -
6. Shri Satya Kishore Mathur Manager 1000000 1000000 0
7. Ms Vineeta Shah Company Secretary 180000 180000 0
8. Shri Vipin Varkhawat Chief Financial Officer 550000 - # - -

# Details not given as Shri Vipin Varkhawat was not a Chief Financial Officer in thefinancial year 2013-14 *The mentioned figures are excluding Service Tax.

2. Percentage increase in median remuneration

Median remuneration of employees in FY 2014-15 –in Rs Median remuneration of employees in FY 2013-14 - in Rs Percentage increase
318000 300000 6%

3. No. of permanent employees as on 31.3.2015 : 47

4. Relationship between average increase in remuneration and company’sperformance:

There is no direct linkage between average increase in remuneration and company’sperformance.

5. Comparison of remuneration of KMP remuneration against the performance of theCompany

The Company has three KMPs namely;

1. Shri Satya Kishore Mathur Manager

2. Shri Vipin Varkhawat Chief Financial Officer

3. Ms. Vineeta Shah Company Secretary

The remuneration of the KMPs has no direct linkage with the Company’s performance.

6. Variation in market capitalization PE ratio;

Particulars As on 31.3.2015 As on 31.3.2014 As on last public offer as on 30.07.2008 Percentage increase
Market capitalization of the Company 266863515 240177164 - 11.11%
PE ratio 0.16 0.45 - (64.44%)
Market quotations of equity shares 0.10 - 0.92 (89.13%)

7. Comparison between average percentile increase in salaries of employees (excludingmanagerial personnel) and percentile increase in managerial remuneration.

Average percentile increase in salaries of employees other than managerial personnel in FY 2014-15 Percentile increase in managerial personnel remuneration in FY 2014-15 Justification
11.64% 0% The percentile increase in salaries of employees is due to appointment of new employees hence this difference

8. The key parameters for any variable component of remuneration availed by Directors– There is no variable component paid to the Directors.

9. There was no employee who received remuneration in excess of the highest paiddirector in FY 2014-15

10. This is to affirm that the above remuneration is paid as per the RemunerationPolicy of the Company.

For and on behalf of the Board of Directors

Place: Mumbai S. N. BAHETI R. K. DIXIT
Date: 22nd July 2015 Director Director

ANNEXURE D

(Information under Section 134 (3) (m) of the Companies Act 2013 read with Companies(the Companies (Accounts) Rules 2014 and forming part of the Directors’ Report forthe year ended 31st March 2015)

A. CONSERVATION OF ENERGY :

a) Energy conservation measures taken.

• The Company has taken following measures for energy conservation at thefactories:

• In the main power supply department the company has taken measures to set upautomatic power factor controller unit to maintain uniform power factor to get rebate of7% in energy tariff. Demand Controller unit installed to control the maximum demand to geta rebate of Load factor upto 10% to 12% on energy bill amount.

• Stabilizers have been installed at various locations for all the machines /equipments in the factory premises.

• In the humidification plant the company has installed invertors to control thehumidity and temperature automatically wherein at certain cut off points the power isoff thereby saving energy. Also Humidification plant has provided with complete falseceiling and insulation of the supply duct thereby reducing the heat load to save power.

• In the Blow Room department Carding department Draw Frame and Speed Framedepartment have been equipped with inverters.

• Optimization of light points in the factory and office area without effectingproduction. Set lighting voltage by providing stabilizer upto 210/215 volts to get a gainin power

• Company has installed CFL to save power.

• Reduction in Air consumption by regular auditing of air leakages.

• A condensate Recovery System has been set up to reduce the consumption of coalby way of using condensate water directly to Boiler as feed water.

• Started power saving and conservation campaign among all the staff and workers.

b) Additional investment and proposal being implemented for reduction of consumptionof energy.

i) Proposal to provide turbo ventilators above the AC sheet roofing to decrease theheat load of the department which will help to save power in humidification plant.

ii) Monitoring and increasing scale and scope of measures taken the past.

c) Impact of the measures at (a) and (b) above for reduction of energy consumptionand consequent impact on the cost of production of goods.

i) Achieved Load factor gain continuously in every months bills

ii) Achieved Power factor gain every month.

iii) Improving the energy efficiency at all the plants and savings in consumption ofpower and the cost of production. The company will continue to implement planned measuresfor optimization of energy conservation and efficiency.

d) Total energy consumption and energy consumption per unit of production in respectof Industries specified in the schedule thereto.

As per form ‘A’ enclosed.

B. TECHNOLOGY ABSORPTION: Efforts made in technology absorption. As per form‘B enclosed.

C. FOREIGN EXCHANGE EARNINGS AND OUTGO:

(Amt in Rs)
CURRENT YEAR 2014-15 PREVIOUS YEAR 2013-14 (9 months period ending 31-03-2014)
Total Foreign Exchange earning 319143692 267908474
Total Foreign Exchange outgo Nil Nil

FORM – A

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

A. POWER AND FUEL CONSUMPTION CURRENT YEAR 2014 – 2015 PREVIOUS YEAR 2013 – 2014 (9 months period ending 31-03-2014)
1 Electricity
a) Purchases Unit 21074640 21366370
Total Amount (Rs.) 150747141 134291120
Rate / Unit (Rs.) 7.15 6.29
b) Own Generation
i) Through coal based thermal Power plant unit Nil Nil
Unit per kg. of Coal Nil Nil
Cost/Unit Nil Nil
ii) Through furnace oil generator unit Nil Nil
Units per kg. of Furnace oil Nil Nil
Cost/Unit Nil Nil
iii) Through furnace oil generator unit Nil Nil
Units per kg. of Diesel oil Nil Nil
Cost/Unit Nil Nil
2 Coal Quantity (MT) Nil Nil
Total Cost (Rs.) Nil Nil
Average rate/MT (Rs.) Nil Nil
3 Lignite Quantity (MT) Nil Nil
Total Cost (Rs.) Nil Nil
Average rate/MT (Rs.) Nil Nil
4 LPG Quantity (MT) Nil Nil
Total Cost (Rs.) Nil Nil
Average rate/MT (Rs.) Nil Nil
5 Furnace oil Quantity (Kgs.) Nil Nil
Total Cost (Rs.) Nil Nil
Average rate/MT (Rs.) Nil Nil
6 Diesel Quantity (Ltrs) Nil Nil
Total Cost (Rs.) Nil Nil
Average rate/MT (Rs.) Nil Nil
7 Other/Internal Generation Nil Nil
B Consumption per unit of Production
Yarn Production (MT) 5554.38 3899.84
Total Consumption Unit 21074640 21366370
Consumption Unit/Kg (Rs.) 3.79 5.48

FORM B

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION FOR THE YEARENDED 31 ST MARCH 2015.

RESEARCH AND DEVELOPMENT (R&D)

1. Specific area in which R&D carried out by the company

• The company has installed latest technology spinning machineries along withcontamination clearing machines to provide contamination free yarn to the customers.

• The company has set-up world class cotton and yarn testing laboratory. R&Dis being conducted regularly for improving the quality and productivity to provideinternational quality standards to the various customers in India and abroad.

• The R&D department of the company is continuously working on developing newfancy varieties of yarn and value added yarns.

2. Benefits derived as a result of the above R&D

The products of the company are well accepted due to its high quality standards atnational and international level. The company has optimized speed without affectingquality resulting increase in productivity and utilization.

3. Future plans and action

Research and development is a continuous process so according to the market trendfurther development with new value added products will be produced. The company will bepurchasing fabric testing machines and is also planning to produce various types of fancyyarn.

4. Expenditure on R & D

a) Capital expenditure is approx Rs. Nil

b) Recurring – normal running expenditure Rs. Nil

c) Total Rs. Nil

TECHNOLOGY ADOPTION AND INNOVATION

A) Efforts in brief made towards technology absorption adoption and Innovation.

The company has also imported machines with better technology such as Autoconers for itrotor based yarn manufacturing.

B) Benefits derived as a result of the above efforts e.g.: product improvement costreduction production development etc.

The company has reduced cost due to high productivity and automated machines. Theproducts of company are well accepted in India as well as abroad in view of good qualityof yarn.

C) No new Technology is imported during the financial year.

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