ODYSSEY VIDEO COMMUNICATIONS LIMITED
ANNUAL REPORT 2004-2005
Your Directors place the Twelfth Annual Report on the working of your
Company for the financial year ended 31st March 2005.
Particulars Current Year Previous Year
Rs. In Lakhs Rs. In Lakhs
Earnings from Services including other income 448.41 453.63
Cost of Services 420.69 437.74
Operational Costs 107.36 99.26
Profit/(Loss) (79.64) (83.37)
The Company's earnings has decreased to Rs. 448.41 lakhs in the current
financial year from Rs. 453.63 lakhs during the previous year.
The Company is expecting good orders during the current financial year.
LISTING AGREEMENT REQUIREMENTS
The Company's shares are listed on The Bangalore Stock Exchange Limited,
The Mumbai Stock Exchange Limited and The Hyderabad Stock Exchange Limited.
The Board is not recommending any Dividend for the year uncle- review.
MANAGEMENT DISCUSSION AND ANALYSIS
a. Industry structure and developments.
The Company operates in the areas of media and marketing communications.
It is projected that the ad industry will grow at an annual rate of 7% to
8%. Due to privatisation and globalisation and shackles being opened for
FDI to come into the country in a big way, there is a potential for this
industry. Many MNC's operating in the ad industry have come in with their
own wholly owned subsidiaries and have got referral business
Your Company has built a reputation over the years amongst its customers
for quality work
b. Opportunities and Threats.
Entry of new businesses into the country due to liberalisation in FDI
Retail being asked to come into the country in a big way.
The Company can utilize its skills in the industry due to its domain
expertise and past experience in working with international brands
c. Segment-wise or product wise performance.
The Company operates only in one pre dominant segment i.e, the advertising
& Print Production industry.
Despite working capital shortage and financial crunch, your Directors have
endeavored and prioritized vigorous improvement in productivity of its
employees and have been successful in keeping its clients happy on the
The Company is also negotiating with the secured lenders for relief and
The Management looks to the future with optimism.
e. Risks and concerns
High attrition rate in ad professionals and high salary costs are the major
risks the industry is facing
Shortage of funds for the Company is a cause of concern for the short term.
The Company having created a niche its services and by remaining
competitive would be able to meet any situation arising out of the risks
f. Internal control systems and their adequacy.
The Company's internal control systems are in place and the management is
of the opinion that they are adequate keeping in view the current level of
operations of the Company
g. Discussion on financial performance with respect to operational
The Company's operations have not been upto the mark in for the financial
year under review. The Company is looking at ways and means of getting into
new lines of work to enable the company to increase its bottom line.
h. Material developments in Human Resources / Industrial Relations front,
including number of people employed.
The Company has professionals drawn from the filed of advertising and print
production. The employees have been recruited keeping in view the current
level of operations and the liquidity problems being faced by the Company.
In terms of the provisions of Section 58A of the Companies Act, 1956 read
with the Companies (Acceptance of Deposits Rules) 1975, the company has not
accepted any fixed deposit during the year under review.
None of the employees of the Company were drawing remuneration in excess of
the limits specified in Section 217 (2A) of the Companies Act 1956 read
with the Companies, (Particulars of Employee Rules), 1975.
In accordance with the provisions of the Companies Act, 1956, and the
Articles of Association of the Company, Mr. Gautam Chowdhury, Directors
retires by rotation at the ensuing Annual General Meeting and being
eligible, offers himselves for re - appointment.
The Company had constituted an Audit Committee pursuant to the provisions
of Section 292A of the Companies Act, 1956 read with clause 49 of the
Listing Agreement. The Audit Committee consists of Mr. B P Ravishankar, Mr.
Mohan Krishnan and Mr. Gautam Chowdhury as members, under the Chairmanship
of Mr. B P Ravishankar.
DIRECTORS RESPONSIBILITY STATEMENT: (Under Section 217 (2AA) of the
Companies Act, 1956)
As per the provisions of Section 217 (2AA) of the Companies Act 1956, the
Directors hereby submit that:
1) The Company has followed all the applicable Accounting standards and
there is no material departure from this in the preparation of the annual
2) The Company had selected the normal accounting policies and applied them
consistently and made judgment and estimates that are responsible and
prudent so as to give a true and fair view of the affairs of the Company
at the end of the financial year and the profit and loss account of the
Company for that period.
3) Proper and sufficient care has been taken by the Company for maintenance
of proper accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
detecting frauds and irregularities.
4) The accounts of the Company are prepared on a `going concern' concept
AUDITORS & AUDIT REPORT
M/s B K Ramadhyani and Co., Chartered Accountants, the statutory auditors
of the Company retire at the ensuing Annual General Meeting and have
expressed their willingness to continue, as auditors if reappointed and are
eligible for reappointment.
In response to the qualifications of the Auditors in their report, your
directors wish to state as follows:
Point 4(f) and Point 11 of annexure in Auditors' Report
An application has been made to the Debenture holders seeking Rephasement
of Repayment / Redemption and waiver of interest and resultantly these
amounts are not due for Redemptions.
Point 4(g) and Point 10 of annexure in Auditors' Report
The management is of the belief that the operations can be revived and made
profitable by increasing the operational efficiency and the ability to
obtain future contracts on consultancy basis.
The management is of the belief that a ore time settlement and resultant
waiver of interest/penal interest from secured lenders can be obtained:
The management is of the belief that it can obtain a favorable order from
high court of Bombay and repossess the confiscated goods imported under
EPCG Scheme along with waiver of the fine, export obligations and refund of
Point 5(a) in Auditors' Report
The Company had sent formal requests to debtors and creditors for
confirmation of balances. In spite of earnest efforts made by the company,
most of the debtors / creditors have not responded confirming the same. The
same. has been mentioned also in Note 2, Schedule 17.
Point 5(b) in Auditors' Report
The appeal filed with the Ministry of Commerce on the conditions imposed
under the EPCG scheme is pending disposal. The Company had filed a writ in
the High Court of Karnataka to hasten the hearing of the appeal pending
with the DGFT. The same has been mentioned also in Schedule 17.
Point 7 of Annexure to Auditors Report
The Company is going through a turbulent period and all expenses have been
pared to the minimum. Once the cash flows become smooth, the Company will
Point 9 (a) & (c) of Annexure to Auditors Report
There has been a delay in remittance of statutory dues in certain months
and service tax payable are in arrears due to tight cash flows. Once the
cash flows become smooth, the Company will comply
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS &
The information required to be furnished in terms of Section 217(1)(e) of
the Companies Act, 1956, read with the Company (Disclosure of Particulars
in the Report of Board of Directors) Rules 1988, with respect to Research
and Development, Technology absorption, and Conservation of energy, is not
applicable to the Company.
There has been no earnings or outflow on account of foreign exchange during
The Board of Directors take this opportunity to express their appreciation
to the employees at all levels in the Company for their dedicated service.
Your Directors also thank the Bankers, KSFC and the customers for their
unstinted support to the Company.
FOR AND ON BEHALF OF THE BOARD
FOR ODYSSEY VIDEO COMMUNICATIONS LIMITED
GAUTAM CHOWDHURY B.P.RAVISHANKAR
DIRECTOR WHOLE -TIME DIRECTOR
Date : 25h August, 2005
Place : Bangalore