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Nitin Spinners Ltd.

BSE: 532698 Sector: Industrials
NSE: NITINSPIN ISIN Code: INE229H01012
BSE LIVE 15:40 | 17 Nov 105.95 0.05
(0.05%)
OPEN

106.60

HIGH

108.80

LOW

102.00

NSE 15:31 | 17 Nov 105.20 -0.45
(-0.43%)
OPEN

105.20

HIGH

108.60

LOW

104.20

OPEN 106.60
PREVIOUS CLOSE 105.90
VOLUME 38289
52-Week high 145.00
52-Week low 61.00
P/E 11.25
Mkt Cap.(Rs cr) 585
Buy Price 0.00
Buy Qty 0.00
Sell Price 105.95
Sell Qty 95.00
OPEN 106.60
CLOSE 105.90
VOLUME 38289
52-Week high 145.00
52-Week low 61.00
P/E 11.25
Mkt Cap.(Rs cr) 585
Buy Price 0.00
Buy Qty 0.00
Sell Price 105.95
Sell Qty 95.00

Nitin Spinners Ltd. (NITINSPIN) - Director Report

Company director report

Your Directors have pleasure to present 25th Annual Report on the business andoperations of your Company and the Financial Statements for the year ended 31st March2017.

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 93337.96 76686.68
Gross Profit Before Finance Cost Depreciation & Exceptional item 13391.23 13776.19
Finance Cost 2224.18 3300.98
Profit before Depreciation & Exceptional items 11167.05 10475.21
Depreciation 4165.12 3955.73
Exceptional items - -
Profit before Taxation 7001.93 6519.48
Provision for Taxation - Current (Net of MAT Credit) 221.74 1167.61
- Deferred Tax 1065.14 935.59
Net Profit after Tax 5715.05 4416.28
Balance brought forward 10814.39 7699.76
Total balance available for appropriation 16529.44 12116.04
Appropriations: -
-Proposed Dividend 550.01 458.34
-Tax on Dividend 111.97 93.31
-Transfer to General Reserve 750.00 750.00
Balance Carried to Balance Sheet 15117.46 10814.39

OPERATIONAL REVIEW

Turnover:

Your Directors are pleased to inform that during the year under review your Companyreported encouraging performance. The Company has recorded highest ever turnover of Rs.933.38 Crores in current year against Rs. 766.87 Crores in the previous year an increaseof 21.71%. The turnover of Cotton Yarn increased by 21.94% from Rs. 587.93 Crores to Rs.716.93 Crores whereas the turnover of Knitted Fabric increased by 14.34% from Rs. 138.39Crores in the previous year to Rs. 158.24 Crores during the current year. Knitted Fabricturnover constitute 16.95% of the total turnover.

Exports:

The export turnover was increased by 11.28% from Rs. 531.53 Crores in the previous yearto Rs. 591.47 Crores in the current year. The export turnover constitutes 63.37% of thetotal turnover.

Profitability & Transfer To General Reserve: -

The higher cotton prices in our country in comparison to International market andvolatility in foreign exchange rates adversely affected operating profit (EBIDTA) of theCompany. Moreover during the year under review power cost also increased substantiallydue to steep increase in power tariff other levies and surcharge by the State Government.Due to these factors there was marginal decrease in the operating profit of the Companyfrom Rs. 137.76 Crores in the previous year to Rs. 133.91 Crores in current year. Howeverthere was substantial reduction in the Interest cost & Taxes of the Company whichresulted in remarkable growth of 29.41% in the Net Profit (PAT) which increased to Rs.57.15 Crores in the year under review from Rs. 44.16 Crores during the previous year. Asum of Rs. 7.50 Crores has been transferred to General Reserves out of the Net Profit ofRs. 57.15 Crores.

DIVIDEND

Your Directors are pleased to recommend Dividend of 12% i.e. Rs. 1.20 per Equity Shareson the fully paid-up Equity Shares of Rs. 10/- each for the financial year 2016-17 subjectto approval of shareholders at the ensuing Annual General Meeting as against Rs. 1.00 perequity share of Rs. 10.00 each for the previous year ended 31st March 2016. The totaloutgo on this account including Dividend Tax shall be Rs. 661.98 Lacs

EXPANSION PROJECT

The Company has successfully implemented expansion project of Rs. 290 Crores andcommercial production commenced in the last quarter of the financial year under review.The investments in the project are eligible for Interest subsidy and other benefits underRajasthan Investment Promotion Scheme 2014. The production on expanded capacity is onfull swing and your Company will get benefits of expansion for full year in the currentfinancial year.

CORPORATE SOCIAL RESPONSIBILITY (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 Company's vision on CSR is that the Company being a responsible Corporate Citizenwould continue to make a serious endeavor for a quality and better society through its CSRrelated initiatives.

During the current year the Company has incurred expenditure of Rs. 67.71 Lacs on CSRactivities against liability of Rs. 114.53 Lacs. Accordingly there was shortfall of Rs.46.82 Lacs on CSR expenditure. The Company has applied to Urban Improvement TrustBhilwara for approval of drawing for construction of Girls/Women hostel. The constructioncan be started after receipt of the approval of drawings and it is expected shortly. Thisshortfall of Rs. 46.82 Lacs on CSR activities shall be incurred during the current year inaddition to the liability of CSR expenditure for the current year 2017-18. The disclosuresof CSR activities pursuant to Section 134(3) of the Companies Act 2014 read with Rule 9of Companies (Corporate Social Responsibility) Rules 2014 is annexed hereto and form partof this report as Annexure – I.

DIRECTORS

Shri Nitin Nolakha Director of the Company retires 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. The Board recommends his appointment for consideration of members ofthe Company at the ensuing Annual General Meeting.

All Independent Directors of the Company have confirmed that they are complying withthe requirement of Section 149(6) of the Companies Act 2013 and applicable provisions ofSEBI (Listing Obligations & Disclosure Requirements) Regulations 2015.

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 pursuantto provisions of Section 139(2) of the Companies Act 2013 they are not eligible forre-appointment due to compulsory rotation and therefore M/s Kalani & Co. CharteredAccountants Bhilwara being eligible under the provisions of Section 139 of the CompaniesAct 2013 are proposed to be appointed as Statutory Auditors of the Company for five yearsfrom the conclusion of ensuing Annual General Meeting and to conduct Statutory Audit fromthe Financial Year 2017-18.

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 2017-18 under the provisions of Section 204 of the Companies Act 2013.

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 2017-18.

SECRETARIAL AUDIT REPORT

The Board of Directors has appointed M/s. V. M & Associates Company Secretaries inWhole-Time Practice to conduct Secretarial Audit for the FY 2016-17 under the provisionsof Section 204 of the Companies Act 2013. The Report of Secretarial Auditors is enclosedherewith. The report 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 Board's Report.

AWARDS & RECOGNITION

Your Company has been conferred with the following awards and recognition during theyear under review: -

1. Texprocil Bronze trophy for the 3rd highest exports of cotton yarn counts 50s andbelow under Category II for F.Y. 2015-16

2. Texprocil Bronze Plaque for the Third Highest Exports of "Grey Fabrics"under Category I for the F.Y. 2015-16

3. Rajasthan Energy Conservation Award by the Government of Rajasthan for efforts forEnergy Conservation for the year 2015-16 under large Spinning Category.

4. UCCI Excellence Award 2017 by Udaipur Chamber of Commerce & Industry under LargeEnterprise Category.

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 imparts 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 IndustriesGovernment 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 thisReport.

OTHER DISCLOSURES UNDER COMPANIES ACT 2013

i) Number of Board Meetings:

The Board of Directors met four times in the year 2016-17. 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 Shri Y. R. Shah ChairmanSmt. Aditi Mehta and Dr. R. Chattopadhyay 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 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 underSection 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 2017.

vi) Comments on Auditors' Reports:

There is no adverse remark or comments in the Statutory Auditors' & SecretarialAuditors' Reports and therefore no comments 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) Extract of 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.

There is no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year and the date of thereport.

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

There is no significant and material order has been passed during the year by theregulators or courts or tribunals which can impact the going concern status and theCompany's operations 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 and vendors of the Company.

For and on Behalf of the Board of Directors
R. L. NOLKHA
Place : Bhilwara Chairman
Date : 6th May 2017 (DIN – 00060746)