NAYAGARA PAPER PRODUCTS (INDIA) LIMITED
ANNUAL REPORT 2004-2005
Your Directors are pleased to present the Seventeenth Annual Report
together with the Audited Accounts of the company for the year ended 31st
The financial performance of the Company during the year is summarized
(Rs. in Lakhs)
Particulars Year Ended Year Ended
March 31, 2005 March 31, 2004
Total Income 199.09 53.78
Operating Profit / (Loss) 60.07 (76.71)
Less: Depreciation 59.00 59.00
Net Profit / (Loss) 1.07 (374.76)
Review and Prospects:
The Company has achieved a turnover of Rs.198.07 Lakhs during the year
under the review and made a modest profit of Rs.1.07 lakhs as a result of
consistent and strenuous efforts by the management to revitalize and
turnaround the Company.
In spite of various problems faced by the Company due to its sickness, lack
of working capital etc., the Board is confident of the future prospects of
the Company. The Company has entered into Agreements with M/s.Industrial
Development Bank of India and M/s. Corporation Bank for settlement of dues.
As you know your Company has appealed to AAFIR with which the case is
registered vide registration No. 220/2001. The matter is under the
consideration of AAFIR.
Mr. I. Vinay Kumar Reddy, Director is liable to retire by rotation at the
ensuing Annual General Meeting and being eligible, offers himself for re-
M/s M.G.Rao & Co, Chartered Accountants, the Statutory Auditors of the
Company retire at the conclusion of the ensuing Annual General Meeting and
being eligible, offer themselves for reappointment.
Your Company has complied with the mandatory provisions of the Corporate
Governance prescribed in the presently applicable Clause 49 of the Listing
Agreement with the Stock Exchanges. A separate report detailing such
compliance together with the Certificate from the Auditors in connection
therewith is included as part of the Annual Report.
Replies to the Auditors' observations:
Item No.iii (c)&(d). The Company has been taking active steps to recover
the principle and interest from the parties to whom the loans are given by
the company and the directors are confident of recovering all the dales.
Item No.vii. The company is taking steps to appoint an internal auditor
Item No.ix(a). The company is taking necessary steps to clear the
undisputed statutory dues with appropriate authorities.
Item No.ix(c). The Commissioner of Income Tax has to reassess the Income
Tax liability as the tax liability of the Company is under dispute. The
company will clear the liability once the issue is resolved.
The Company has not invited/accepted any fixed deposits from the public in
terms of Section 58A of the Companies Act, 1956.
None of the employees is covered under Section 217 (2A) of the Companies
Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975.
Information as per Section 217(1)(e) of the Companies Act, 1956:
Your Company has no activity relating to conservation of energy or
technology absorption. During the year under review and there are no
foreign exchange earnings or outflow.
Directors' Responsibility Statement:
As required under Section 217 (2AA), which was introduced by the Companies
(Amendment) Act, 2000 your Directors confirm that:
i) In the preparation of the annual accounts, the applicable accounting
standards have been followed.
ii) 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 on 31st March 2005 and of the profit or loss of the company for
the year ended 31st March 2005.
iii) 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;
iv) The Directors have prepared the annual, accounts on a going concern
The Company's Equity shares are listed in the Hyderabad Stock Exchange Ltd
(Regional Stock Exchange) as well as the Mumbai Stock Exchange and
Ahmedabad Stock Exchange.
The arrears of the listing fees payable to the Stock Exchanges is as
Up to the previous 2005-06 Total Due
The Stock Exchange, Mumbai - - -
Hyderabad Stock Exchange Ltd 70,000/- 14,000/- 84,000/-
Ahmedabad Stock Exchange 55,000/- 10,000/- 65,000/-
The relations with the employees continued to be cordial during the year.
The directors wish to place on record their deep appreciation of the
efficient and loyal services rendered by the employees at all levels.
Your Directors also thank the Financial Institutions, Bankers, and
Distributors for unstinted support to the Company. Your Directors would
like to thank all the shareholders who have reposed faith in the Company.
Your directors also thank the various departments of the Government of
India, Government of Andhra Pradesh and its Agencies for their support
during the year and look forward to their continued support.
On behalf of the Board
Place : Nellore Sd/-
Date : 10.08.2005 K V. Reddy
Chairman & Managing Director
Management discussion and analysis:
The Paper Industry covering pulp paper and paperboard is one of the 35 high
priority industries in India. The industry contributes over Rs.2500 Crores.
annually to the exchequer. The industries turnover is around Rs.12,000
Crores, and it provides employment to more than 3,00,000 people directly
and about 10,00,000 people indirectly. The country is by and large self-
sufficient in paper production and also contributes to foreign exchange
byway of export.
Today, India produces a wide range of Paper & Paperboards using a variety
of raw materials and the Indian Paper Industry is highly fragmented and
dominated by small and medium scale units.
Nayagara Paper Products (India) Limited, having its manufacturing unit at
205 A/B, Auto Nagar, Nellore in Andhra Pradesh. This unit has been involved
in the manufacture of paper products like books, writing books, work books,
account books, writing pads, diaries and calendars etc,
The Board of Directors of the Company is fully satisfied with the control
systems in force in all areas of its operations at its unit and registered
office at Nellore. Effectiveness of these systems is reviewed at periodic
intervals for possible improvement.
The company has well deserved and dedicated marketing network consisting of
agents, distributors and dealers. The Company's marketing personnel
maintain constant contact with all these entities with a view to ensure
smooth flow of marketing / sales operations and realization of sale
Despite the positive factors mentioned above, the Company views with
concern the impact of sickness of the Company and also necessary steps to
be taken to come out from the said situation. However the Company is
confident of overcoming this situation with its emphasis on quality arid
cost together with aggressive marketing.