PASHUPATI SEOHUNG LTD.
ANNUAL REPORT 1998-99
I have great pleasure in welcoming you all to this 7th Annual General
Meeting of your Company. The year 1998-99 was not as good as expected.
Though the Company has escalated the profit marginally but the quantum of
the same is much below the expected level. The reasons for the same have
already been clarified in Directors Report. However the Company has taken
the corrective measures to optimise the profit margin to the extent
possible and assure you of better performance in the current year.
There was turbulent effect of currency devaluation globally and the impact
of the same was much vicious in the countries of Asia and Europe
particularly in the second half of the financial year under review. Your
Company, being a 100% EOU, was also victimized by way of stagnated business
opportunities with the countries where 80% of the total sales counted. You
can well appreciate the reasonability for the sales downfall and the
realisations also as during that period it was totally gloomy market due to
uncertaintly of the negotiating currency.
The Indian economy was also not very impressive during the year under
review so as to encounter the DTA Market with the incentive portions as
provided to the EOUs.
Industrial growth rate declined as compared to previous year. However
agriculture sector showed a positive growth. Though the import increased
too much as compared to exports, the foreign exchange reserve was quite
However, the tax structure was continued to be simplified in Union Budget
for 1999-2000 also. Efforts are being in the way by Government for
libralisation of economy. Tax holiday to new industries has been extended.
Your Company will also be benefitted by this decision. Various other
facilities were also extended to the exporters by the Government.
Due to sudden imbalance in the global economy, including Russia, the
Company could not do well. The turnover during the period under review was
Rs.690.50 lacs as against 652.86 lacs in the previous year. Though both the
quantity as well as value of condoms sold had shown a rise but the net
realisation was not compatible.
The production during the year under review was 63.80 MPC reflecting lower
productivity due to insufficient working capital.
The Company earned a net profit of Rs.29.87 lacs. The downfall in profit
was due to lower growth rate in sales comparing to last year as well as
lower realisation of sales.
Gross Assets raised to Rs, 1,367,60 lacs against Rs. 1,340,43 lacs in the
Net Current Assets raised to Rs. 372.95 lacs against Rs.285.44 lacs in the
Condom, being the tool used not only for birth control but also for
prevention of AIDS and STDs. The data shows that by the year 2000 there
will be 40 million AIDS patients worldwide irrespective of developed and
underdeveloped countries. As a result, the demand for Condom is
continuously increasing. There is a vast gap between the demand and supply
of Condom globally. The worldwide demand for Condom is about 16 billion pcs
per year whereas the supply is around 13 billion psc approximately.
Due to sudden fall in the exports, the company confronted with serious cash
crunch situation during 1998-99. Hence the decision for expansion could not
be materialised. However the clutches labelling to the global economy has
been frozen and the expansion programme is being carries out at a
As already informed to you the Company has taken steps in compliance with
the formalities involved for ISO accredition and expected to be completed
within current financial year.
In spite of all the financial problems faced by the Company during the year
under review, the Company maintained its operation uninterruptedly as well
as service to its shareholders. However lapses, if any, though not
intentional but incidental in meeting the requirements of the shareholders
are sincerely regretted.
Before concluding I wish to thank all my colleagues on the Board who in
spite of some other pre-occupations spare considerable time and actively
participated in the deliberations of the Board on important issues and
guided with their vast experience for smooth functioning of the Company. I
am also thankful to our foreign collaborators M/s. Seohung Industrial Co.
Ltd. for their continuous and active co-operation. I wish to place on
record my sincere appreciation for the employees at all levels of operation
and acknowledge their loyalty, support and professional approach and for
the co-operation extended by the Union. I also thank to the Financial
Institutions, Banks, Govt. of West Bengal and various authorities of the
Govt. of India for their continuous support and co-operation to the
Chairman & Managing Director
Place : Calcutta
Dated : 21st August, 1999