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Nitin Spinners Ltd.

BSE: 532698 Sector: Industrials
NSE: NITINSPIN ISIN Code: INE229H01012
BSE LIVE 15:52 | 18 Aug 117.95 2.55
(2.21%)
OPEN

116.00

HIGH

119.60

LOW

114.70

NSE 15:57 | 18 Aug 118.00 1.60
(1.37%)
OPEN

117.50

HIGH

119.60

LOW

114.95

OPEN 116.00
PREVIOUS CLOSE 115.40
VOLUME 25098
52-Week high 145.00
52-Week low 61.00
P/E 9.36
Mkt Cap.(Rs cr) 541
Buy Price 0.00
Buy Qty 0.00
Sell Price 117.95
Sell Qty 341.00
OPEN 116.00
CLOSE 115.40
VOLUME 25098
52-Week high 145.00
52-Week low 61.00
P/E 9.36
Mkt Cap.(Rs cr) 541
Buy Price 0.00
Buy Qty 0.00
Sell Price 117.95
Sell Qty 341.00

Nitin Spinners Ltd. (NITINSPIN) - Director Report

Company director report

Your Directors are pleased to present 24th Annual Report on the business and operationsof your Company and the Financial Statements for the year ended 31st March 2016

FINANCIAL RESULTS

The Financial results of the Company's operations for the year under review and thoseof the previous year are as follows: -

(Rs. in Lacs)

Particulars Current Year Previous Year
Revenue From Operations 76686.68 61647.23
Gross Profit Before Finance Cost Depreciation & Exceptional item. 13776.19 10430.65
Finance Cost 3300.98 2261.98
Profit before Depreciation & Exceptional items 10475.21 8168.67
Depreciation 3955.73 2794.00
Exceptional items
Profit before Taxation 6519.48 5374.67
Provision for Taxation - Current 1167.61
(Net of MAT Credit)
- Deferred Tax 935.59 1278.73
Net Profit after Tax 4416.28 4095.94
Balance brought forward 7699.76 4905.47
Total balance available for appropriation 12116.04 9001.41
Appropriations :-
– Proposed Dividend 458.34 458.34
– Tax on Dividend 93.31 93.31
– Transfer to General
Reserve 750.00 750.00
Balance Carried to Balance Sheet 10814.39 7699.76

OPERATIONAL REVIEW

Turnover :-

The year under review was another challenging year for Cotton Textiles with thedeclining cotton cotton yarn and fabric prices. However due to substantial capacityexpansion in the previous year the company has recorded highest ever turnover of Rs.766.87 Crores in current year against Rs. 616.47 Crores in the previous year an increaseof 24.40%. The turnover of Cotton Yarn increased by 24.56% from Rs 472.01 Crores to Rs587.93 Crores whereas the turnover of Knitted Fabric increased by 15.74% from Rs. 119.57Crores in the previous year to Rs. 138.39 Crores during the current year. Knitted Fabricturnover constitute 18.53% of the total turnover.

Exports :-

The export turnover significantly increased by 35.53% from Rs. 392.18 Crores in theprevious year to Rs. 531.53 Crores in the current year. The export turnover constitutes69.31% of the total turnover.

Profitability :-

The operating profit (EBIDTA) has increased from Rs. 104.31 Crores in previous year toRs. 137.76 Crores in current year registering considerable increase of 32.08% overprevious year. In view of substantial capacity expansion in previous year the Financecost and Depreciation has increased considerably resulting in marginal growth in the netprofit. The Company has reported Net Profit (PAT) of Rs. 44.16 Crores during the yearunder review against Rs. 40.96 Crores in the previous year registering an increase of7.81% over the last year. A sum of Rs 7.50 Crores has been transferred to General Reservesout of the Net Profit.

DIVIDEND

Your Directors are pleased to recommend Dividend of 10% i.e. Re. 1/- per Equity Shareson the fully paid-up Equity Shares of Rs. 10/- each for the financial year 2015-16 subjectto approval of shareholders at the ensuing Annual General Meeting. The total outgo on thisaccount including Dividend Tax shall be Rs. 551.65 Lacs.

CAPITAL EXPENDITURE

In view of the promising long term scenario for textile industry in domestic as well asin export market and favorable Government Policies the Company has undertaken anotherexpansion project for installation 72960 Compact Spindles at the existing location atproject cost of Rs. 290 Crores. The project is partly financed through term loan of Rs.215 Crores and balance from internal accruals. The project is under implementation as perschedule and commercial production is planned to commence by the end of the currentfinancial year 2016-17. The expansion project is eligible for benefits of CustomizedPackage under Rajasthan Investment Promotion Scheme 2014.

CORPORATE SOCIAL RESPONSIBILTY (CSR)

Your Company is committed to make a positive contribution to communities where itoperates. Pursuant to Section 135 of the Companies Act 2013 the Company constituted CSRcommittee and formulated CSR Policy as guiding principle for undertaking CSR activities.The CSR committee comprises of Sh. R.L. Nolkha Chairman Sh. Dinesh Nolkha ManagingDirector Sh. Y.R. Shah Independent Director and Smt. Aditi Mehta Independent Director.During the current year the Company has purchased land for construction of Girls/WomenHostel at Bhilwara. Total expenditure on CSR activities during the year was Rs. 108.77Lacs against liability of Rs. 85.53 Lacs. The details of CSR activities in the prescribedformat are enclosed as Annexure - I to this report.

DIRECTORS

Sh. B. Ram has resigned from the Directorship of the Company and he ceased to beDirector of the Company w.e.f. 24.10.2015. The board places on record its sincereappreciation for the valuable contribution made by Shri B. Ram during his tenure ofdirectorship of the company. All Independent Directors of the Company have confirmed thatthey are complying with the requirement of section 149(6) of the Companies Act 2013 andapplicable provisions of SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015.

Shri R. L. Nolkha Director of the Company retire by rotation at the ensuing AnnualGeneral Meeting and being eligible offer himself for re-appointment. Details of theDirector seeking re-appointment are provided in the Corporate Governance Report formingpart of this report.

AUDITORS

M/s R. S. Dani & Co. Chartered Accountants and Statutory Auditors of the Companyretire at the conclusion of the ensuing Annual General Meeting of the Company and beingeligible offer themselves for re-appointment. Your Directors recommend for theirre-appointment.

In pursuance of Section 148 of the Companies Act 2013 your Directors havere-appointed M/s. V. K. Goyal & Company Cost Accountants being eligible to conductCost Audit of the Company for the Financial Year 2016-17.

The Board of Directors has re-appointed M/s V.M & Associates Company Secretariesin Whole-Time Practice being eligible to conduct Secretarial Audit for the FinancialYear 2016-17 under the provisions of section 204 of the Companies Act 2013.

SECRETARIAL AUDIT REPORT

The Board of Directors has appointed M/s. V. M & Associates Company Secretaries inWhole-Time Practice to conduct Secretarial Audit under the provisions of section 204 ofthe Companies Act 2013. The Report of Secretarial Auditors is enclosed herewith. Thereport does not contain any qualification.

CORPORATE GOVERNANCE

The Company is committed to maintain the high standards of Corporate Governance. YourDirectors adhere to the requirements set out in Companies Act 2013 and the SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 and have implemented all theprescribed requirements. In pursuant to regulation 34(3) of the SEBI (Listing Obligations& Disclosure Requirements) Regulations 2015 the Reports on Corporate Governance andManagement Discussions & Analysis have been incorporated in the Annual Report andforms an integral part of the Directors' Report.

AWARDS & RECOGNITION

Your Company has been conferred following awards and recognition during the year underreview :-

1. Texprocil's Bronze Trophy for "Top Exporters -Fabrics" in the category of"Grey Fabric" for the year 2014-15.

2. Award from the Government of Rajasthan for excellent performance in exports in theState for the year 2013-14.

3. Rajasthan Energy Conservation Award by the Government of Rajasthan for efforts forEnergy Conservation for the year 2014-15.

4. Recognition as Three star export house status by the office of the Jt. DirectorGeneral Foreign Trade Jaipur.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to sub-section 3 (c) of Section 134 of the Companies Act 2013 the Board ofDirectors of the Company hereby state and confirm that:

(i) in the preparation of Annual Accounts the applicable accounting standards havebeen followed and wherever required proper explanation relating to material departureshave been given;

(ii) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitor loss of the Company for that period;

(iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities

(iv) they have prepared the Annual Accounts on a going concern basis;

(v) they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and were operating effectively; and

(vi) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

HUMAN RESOURCE DEVELOPMENT

Industrial relations continued to be cordial during the period under review. YourCompany firmly believes that a dedicated work force constitutes the primary source ofsustainable competitive advantage. Accordingly human resource development receivedfocused attention. The Company has in house skill training centre and impart on the jobtraining to its manpower on continuous basis. The Skill Training Centre of the Company hasbeen approved under Integrated Skill Development Scheme by the

Department of Industries Government of Rajasthan Jaipur.

Your Directors wish to place on record their appreciation for the dedicated servicesrendered by the work force during the year under review.

ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

A Statement giving details of conservation of energy technology absorption foreignexchange earnings and outgo in accordance with the Rule 8 (3) of the Companies (Accounts)Rules 2014 is enclosed as Annexure - II and forms integral part of this Report.

OTHER DISCLOSURES UNDER COMPANIES ACT 2013

i) Number of Board Meetings :

The Board of Directors met four times in the year 2015-16. The details of the BoardMeeting and the attendance of the Directors are provided in the Corporate GovernanceReport.

ii) Composition of Audit Committee :

The Board constituted the Audit Committee which comprises of Sh. Y. R. Shah ChairmanDr. R. Chattopadhyay and Smt. Aditi Mehta as members. All the recommendations of AuditCommittee have been accepted by the Board. More details on the committee are given in theCorporate Governance Report.

iii) Related Party Transactions :

All the related party transactions are entered on arm's length basis and in theordinary course of business. The Company has complied with all the applicable provisionsof the Act and SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015in this regard. There is no materially significant related party transaction withPromoters Directors or Key Management Personnel which may have potential conflict withthe interest of the Company at large. During the year the Company has not entered intoany related party transactions under the section 188 of the Companies Act 2013 and theparticulars of contracts or arrangements with related parties are Nil and Form AOC-2 isenclosed as Annexure - III

iv) Loans Guarantees or Investments:

The Company has not given any Loan Guarantee and also not made any Investments underthe section 186 of the Companies Act 2013. v) Fixed Deposits :

The Company has not accepted or renewed any fixed deposits during the year under reviewand no fixed deposit is outstanding for payment at the year ended 31st March 2016. vi)Comments on Auditors' Reports :

There is no adverse remark or comments in the Statutory Auditors' & SecretarialAuditors' Reports and therefore no comment are required in the Directors' Report. vii)Vigil Mechanism/ Whistle Blower Policy :

In pursuance of section 177 (9) of the Companies Act 2013 and the SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 the Company has in place aVigil Mechanism/Whistle Blower Policy for Directors and employees to report genuineconcern. More details pertaining to the same are given in the Corporate Governance Report.viii) Nomination Remuneration & Evaluation Policy :

In pursuant to provisions of section 178 of the Companies Act 2013 and SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 the Board of Directors haveapproved Nomination Remuneration & Evaluation Policy for appointment remuneration& evaluation of the Directors Key Management Personnel & Senior ManagementPersonnel. The details of the Nomination and Remuneration committee NominationRemuneration & Evaluation Policy and Annual Evaluation carried out by the Board ofDirectors are given in the Corporate Governance Report. ix) Particulars of Employees &Analysis of Remuneration:

Particulars of employees and analysis of remuneration as required under section 197(12) of the Companies Act 2013 read with Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are enclosed as Annexure - IV x) Extractof Annual Return :

The details forming part of the extract of the Annual Return in Form MGT-9 is enclosedas

Annexure V xi) Miscellaneous Disclosures :-

Details about risk management have been given in the Management Discussions &Analysis.

The Company does not have any subsidiary joint venture & associate company.

There is no significant and material orders has been passed during the year by theregulators or courts or tribunals which can impact the going concern status and Company'soperations in future.

The Company is having adequate Internal Financial Control with reference to theFinancial Statements.

During the year the Company has not received any complaint under the Sexual Harassmentof Woman at Workplace (Prevention Prohibition and Redressal) Act 2013.

ACKNOWLEDGEMENTS

Directors wish to express their grateful appreciation for assistance and co-operationreceived from various Departments of Central & State Governments and Banks during theyear under review. Your Directors also wish to place on record their appreciation for thecommitted services of all the associates vendors of the Company.

For and on Behalf of the Board of Directors
Place : Bhilwara R. L. NOLKHA
Date : 03.05.2016 Chairman
(DIN – 00060746)