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Baroda Electric Meters Ltd.

BSE: 503956 Sector: Engineering
NSE: N.A. ISIN Code: N.A.
BSE 05:30 | 01 Jan Baroda Electric Meters Ltd
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Baroda Electric Meters Ltd. (BARODAELECTRIC) - Director Report

Company director report

BARODA ELECTRIC METERS LIMITED ANNUAL REPORT - 1999-2000 DIRECTORS' REPORT To The Members BARODA ELECTRIC METERS LIMITED VALLABH VIDYANAGAR The Directors submit herewith the 39th Annual Report of the Company together with the Audited Accounts for the year ended 31st March, 2000. OPERATION AND TRADING CONDITIONS During the year the production was 60,558 single phase meters and 52,961 Poly phase meters as compared with 67949 and 12655 respectively for 1998- 99, indicating increase in production of about 78.5%. The average sale price per meter also increased by about 6% from Rs.359/- to Rs.381 /-. Resultant inadequate improvement in profitability of the company is probably due to the change in product mix with increase of Polyphase meters and static meters. The improvement in resultant profitability however has kept pace with the increase in cost. FUTURE OUTLOOK The outlook of the future indicates improvement in profitability provided adequate working capital finance is secured. The factors indicating improvement in outlook are: 1. Recent tenders floated by State Electricity Boards as GEB and PSEB indicating improvement in demand for energy meters. 2. Establishment of Electricity Regulatory Commissions like GERC and MERC etc. which should improve the specifications and pricing of the energy meters. DEVELOPMENT AND DIVERSIFICATION WIND MILL PROJECT Energy units credited to the company through Wind mill and corresponding fund credit is as follows :- 1998-99 1999-2000 Unit Rs . Unit Rs . 1,27,341 4,05,564/- 1,88,776 6,66,562/- The company's production of Static energy meters during the year 1999-2000 has been as follows :- Single phase 68 Nos. Poly phase 1453 Nos. Value (Total Sales) Rs.34 lacs (approx.) Company has made significant progress with the development of static energy meters particularly in the sphere of tamper resistant meters. The company has also executed MOU with Natelco for the manufacture of static energy meters as per the company's design. The Company is looking forward to sanction by Syndicate Bank of adequate working capital facilities as a nursing programme for restoring the profitability of the company. AUDIT REPORT Auditors observations and respective notes to the accounts are self explanatory. FIXED DEPOSITS: No fixed deposits were invited, received or are outstanding. INCOME TAX AND SALES TAX ASSESSMENTS The Income tax assessment upto 1996-97 i.e. assessment year 1997-98 and Sales tax Assessment for 1995-96 have been completed. STAFF AND LABOUR The liability for the Labour Award has been fully provided for in the Accounts. Although the award of the Labour Court is still awaited. The relation with employees otherwise remained cordial during the year. DIRECTORS In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the Company Shri K.B. Mansharamani and Shri J.S.Aiyer retire by rotation, but being eligible offer themselves for reappointment. AUDITORS Messrs Kantilal Patel & Co., Chartered Accountants, Ahmedabad, hold office as Auditors of the Company until the conclusion of the ensuing 39th Annual General Meeting and the Board recommends their re-appointment till the conclusion of the next Annual General Meeting. The Company has received a certificate from Auditors under Section 224(1) of the Companies Act,1956 to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224(1B) of the Act. Members are requested to consider their re-appointment as Auditors of the Company for the current year at a remuneration to be decided by the Board of Directors. For and on Behalf of Board of Directors Chairman of the Meeting REPORT OF THE BOARD OF DIRECTORS OF THE COMPANY PURSUANT TO SECTION 23(1)(b) OF THE SICK INDUSTRIAL COMPANIES (SPECIAL PROVISIONS) ACT, 1985. Section 23 of the Sick Industrial Companies (Special Provisions) Act, 1985 (`the Act') provides that if the accumulated losses of an industrial company as at the end of any financial year have resulted in an erosion of fifty percent or more of its peak net worth during the immediately preceding four financial years, the company shall within a period of sixty days from the date of finalisation of the duly audited accounts of the Company for the relevant financial year report the fact of such erosion to the Board for Industrial and Financial Reconstruction 'the Board') constituted under the Act, and hold a General Meeting of the Shareholders of the Company for considering such erosion. The Company is an industrial company as defined in the Act. 39th Annual General Meeting of the Company will be held on 26th August 2000 when the accounts for the year ended 31 st March, 2000 will be considered and adopted. With the finalisation of these accounts which showed that more than fifty percent of the peak net worth of the Company has been eroded in view of the accumulated losses amounting to Rs.132.03 lakhs as against the peak net worth of Rs.225.38 lakhs as on March 31,1997 the provision of the above said Act have become applicable to the Company. The Board of Directors' have reviewed the situation and are of the opinion that market conditions continue to be difficult and in view of the situation explained, your Company's financial position continues to be precarious. CAUSES FOR EROSION OF MORE THAN FIFTY PERCENT OF THE NET WORTH OF THE COMPANY. i. Due to slow realization of Debtors, the company cannot liquidate the Bill discounted on due date and hence overdue interest is payable to bank. ii. Due to cash crunch, supplier's L.C.'s are not discharged on due date and hence overdue interest is payable to bank. iii. Competition in the market causes to lower market price of the products of the company. iv. Finalisation of wage settlement with workers increase the wage bill of the company. MEASURES TO OVERCOME THE POTENTIAL SICKNESS OF THE COMPANY i) Negotiation are under way with suppliers for credit facilities in lieu of suppliers against L.C. ii) Efforts to realise debtors on due date. iii) To get better market price for the products of the company. iv) Development of static meters in which company can get better margin. BY ORDER OF THE BOARD OF DIRECTORS (N. G. KAMAT ) MANAGING DIRECTOR PLACE : VALLABH VIDYANAGAR. DATE : 29th June 2000 ADDITIONAL PARTICULARS REQUIRED UNDER COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988 FORMING PART OF THE DIRECTORS REPORT FOR THE YEAR ENDED 31ST MARCH 2000 A CONSERVATION OF ENERGY The energy consumption by the company being limited. The scope of energy conservation may not be significant. However the company's efforts are continuing in making its products energy efficient. B RESEARCH & DEVELOPMENT (R&D) 1. Specific area in which R&D is carried out by the company. Microprocessor based (digital) single phase and polyphase static energy meters: More specifically the products being developed are singlephase kwh meters, single phase KVA meters, three phase KWH meters and three phase trivector meters. 2 Benefits derived as a result of above R&D These static meters have been developed for use in house service and industrial applications and a replacement to the Ferrari's electromechanical meters. The Static meter have better sustained accuracy. They incorporate a number of tamper resistant features and are energy saving. 3 Future plan of action: Shift the static meter production from pilot production plant to higher capacity production line. 4. Expenditure on R&D Rs. 5.04 Lacs (Previous Year Rs.4.42) 5 Technology absorption, adaptation and innovation: Does not arise as the development is through in-house R&D