LAN ESEDA INDUSTRIES LIMITED
ANNUAL REPORT 2003-2004
Your Directors have pleasure in presenting the 14th Annual Report and the
audited statement of accounts of the company for the financial year ended
30th June, 2004.
1. FINANCIAL RESULTS:- Rs.'000
Turnover 5,308 5,361
Gross profit before interest and depreciation
Less: Interest NIL NIL
Depreciation NIL NIL
Profit before tax 98 57
Less: Provision for taxation NIL NIL
Profit after tax 98 57
Prior Period Adjustments 410 NIL
Balance B/F from previous ear 935,964 936,021
TOTAL 935,456 1935,964
Proposed dividend on equity shares NIL NIL
Corporate tax on dividend NIL NIL
Debenture redemption reserve NIL NIL
Balance carried to Balance Sheet 935,456 935,964
2. MANAGEMENT ANALYSIS AND DISCUSSION
The sales of the Company for the year ended 30th June, 2004 touched Rs.
53.08 lakhs (Pre Year Rs.53.61 lakhs) and Net Profit were Rs. 0.98 lakhs
(Pre. Year Rs.0.57 lakh). Your Company has lost the business due to poor
domestic scenario, industry down trend ,war threats and global recession.
The year under review was one of them most challenging years for IT
industry all over the world. Constant efforts are put to redesign the
planning and implementation process to aim for leadership on the theme of
rapid growth and differentiation .We are confident that the steps taken
will help achieve the size, scalability, brand and ambition necessary to
create the next generation IT Solutions and Services Company.
REVIEW OF OPERATIONS
The Indian IT Industry is one of the top 10 industries in India. The IT
Industry has shown signs of recovery and IT/Technology Expenditure is
expected to rise this year as against a stagnant trend in the past two
years. The domestic growth has been driven by rapid expansion of IT
Infrastructure by Government, Education, Computer Training, Telecom, BPO
and Corporate segments. The Indian IT Industry is interspersed with several
large, medium and small players offering their services. The competition
and challenges to medium size niche players like LEIL is emerging primarily
from large system integration companies.
Your Company is strong in providing IT Infrastructure set-up, support and
management as well as in the system integration business. The wide range of
products and solutions, domain expertise and competency pools created by
the Company over the year has helped in customer retention and addition of
new customer accounts. Clients are looking for a company that is a trusted
advisor and a strategic partner. In response to clients needs, we have been
working on several new service initiatives. Your company seeks long term
partnerships with clients while addressing their various IT requirements.
Your Company's customer centric approach has resulted in high levels of
Your Company has reorganized to face new challenges of greater client
expectations, rapidly changing business scenario and heightened
competition. As L part of it business process reengineering the Company is
constantly analyzing the business areas to focus on the most profitable and
productive ones. This has helped in maintaining the profitability levels
despite the reduction in the sales turnover. Your Company has also helped
many of its clients improve their processes and systems by providing
consulting services and high-end products arid solutions.
The domestic IT spends is likely to continue its current upward trend.
Organizations have been increasing their IT spends for process improvements
and efficiency enhancements to face competition and increased productivity.
Organizations are widely outsourcing the various activities of managing
their IT infrastructure to increase operational efficiency.
Your Company has dearly drawn its road map as a dominant provider of end-
to-end IT solutions and services encompassing comprehensive services-of IT
infrastructure design, implementation and lifecycle support. Continuous
research and development of new services, products, processes and solutions
allows your Company to enhance quality, productivity and customer
satisfaction through innovation. Initiatives are being taken for
development of solutions on Storage systems, Disaster Management Systems,
Security, Converged Communications etc.
Your company has established a national service network and this will help
in providing supports to a large base of customers. Your company is
continuously evolving new business processes, modifying its existing line
of activities and expanding its business capabilities to gain higher growth
and market share.
Your Directors do not recommend any dividend for the year 30th June,2004.
CLAIM OF LOSS
The operation of the company had a set back consequent upon the collapse of
the operating office building (Poonam Chambers, B Wing, Dr. A. B. Road,
Worli, Mumbai on 11th September, 1997, as a result of which the company had
suffered huge losses. The losses quantified have been transferred to
"claims receivable" based on legal advice. The dislocation of the operation
has been corrected over the months and it is expected to improve upon
further during the current year.
The company has not accepted any deposit within the meaning of Section 58A
of the Companies Act, 1956 and the rules made there under.
Dr. A. Sundarajan retire by rotation at the ensuing Annual General Meeting
and being eligible offer, himself for re-appointment.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement Under Section 217(2AA) of the Companies Act,
1956 with respect to Directors' Responsibility Statement, it is hereby
* That in the preparation of the annual accounts for the financial year
ended 30th June, 2004 the Application Accounting Standards had been
followed along with proper explanation relating to material departures.
* That the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that were 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 or loss of the
company for the year under review.
* That the Director had taken proper and sufficient care 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.
* That the Directors had prepared the accounts for the financial year ended
30th June, 2004 on a going concern basis.
M/s Y.K.Tolia & Associates, Chartered Accountants, Statutory Auditors of
the company hold office till the conclusion of the ensuing Annual General
Meeting and are eligible for re-appointment.
A certificate from the Auditor of the Company regarding compliance of
conditions of corporate governance as stipulated under clause 49of the
listing agreement is attached to this report.
As there are no employees, drawing remuneration as per provisions of
Section 217(2A) of the Companies Act, 1956, and due to that, there is no
requirement to submit particulars of employees as per the provisions of
section 217 (2A) of the Companies Act,1956, read with the provisions of
Companies (Particulars of Employees ) Rules, 1975.
Conservation of Energy, Technology Absorption, Research & Development and
Foreign Exchange Earnings and Outgo:-
Conservation of Energy:
The Company's operations involve low energy consumption. However efforts to
conserve and optimize the use of energy through improved operational
methods and other means will continue.
The Technology available and utilized is continuously being upgraded to
improve overall performance and productivity.
Research & Development:
Your company believes that Research & Development is a continues process
and is a key driver to scalable and sustained corporate excellence. Our
Research & Development activities help us gear for future opportunities and
are focused to provide unique benefits to our customers. accordingly during
the year, several key focus areas were identified.
Foreign Exchange Earnings : Nil Foreign Exchange Outgo: Nil
Your Company continues to be committed to the systems of good corporate
governance by increased transparency and accountability to its
shareholders. Pursuant to clause 49 of the Listing Agreement with Stock
Exchanges, a report On Corporate Governance and Auditors certificate
regarding compliance of conditions of Corporate Governance are made part of
the Annual Report.
Your Directors place on record their appreciation of the assistance and
support extended by all government authorities, financial institutions,
banks, consultants, solicitors, shareholders and debenture holders of the
company. Yours directors also wish to thank management and staff of, the
promoter company, for the continuous guidance and support received from
them. Your directors express their appreciation for the dedicated and
sincere services rendered by employees of the company.
For and on behalf of the Board
R.KACHALIA Dr. A.SUNDARAJAN
Whole Time Director Director
Dated : 16th October,2004
Place : Hyderabad