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BCL Forgings Ltd.

BSE: 506093 Sector: Engineering
NSE: N.A. ISIN Code: INE528H01017
BSE 05:30 | 01 Jan BCL Forgings Ltd
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BCL Forgings Ltd. (BCLFORGINGS) - Director Report

Company director report

BCL FORGINGS LIMITED ANNUAL REPORT 2010-2011 DIRECTOR'S REPORT To All The Members Your Directors have pleasure in presenting Annual Report and the Audited Accounts for the period ended 31.03.2011. (Rs. In Lacs) Financial Results Year ended Year ended 31.03.2011 31.03.2010 Sales & other Income 3353 4493.81 Profit before Depreciation, interest & Tax (853) (172.78) Depreciation 126 145.70 Interest 596 596.94 Deferred Tax Liability Nil (69.66) Profit for the year (853) (845.76) Profit/(Loss) brought forward from previous year (1177) 194.44 Profit/(Loss) after Tax transferred to Balance Sheet (2030) (651.32) OPERATIONS During the, year ending 31.03.2011, the Company could achieve a turn over of Rs. 3353.12 lacs as. compared to the turn over of Rs. 4345.74 lakhs during the year 2009-10. This was mainly on account of continuation of recessionary trends & lack of working capital. Even though the Company has good orders in hand, the same cannot,be fulfilled due to lack of working capital, which is on account of the losses suffered by Company during previous years due to recessionary conditions. However, Management is discussing with bankers for the same and is quite hopeful about the results. Also Management has taken steps to reduce over heads by reducing employee strength and increasing the efficiency. However, with the improvement in the demand pattern for Company's products especially from the Indian clients, simultaneously with the various cost control measures under taken, the Company incurred losses of Rs.. 853 lakhs. However, these losses were mainly due to financial expenses and depreciation of Rs. 719 lakhs. Future Prospects Management is also trying to increase the share of non-automobile sectors such as Windmill Energy, Earth Moving, Equipment, Mining, Hydraulics, Agriculture and export related customers and also has developed various items for the same and consequently we got results as below. i) Turnover for the quarter ended 31.03.2011 was Rs. 828.69 lakhs. ii) Turnover for the quarter ended 30.06.2011 is Rs.1000.48 lakhs iii) Turnover for the quarter ended 30.09.2011 is Rs. 977.62 lakhs Fixed Deposit The Company has hot accepted any Fixed Deposits for the year ended 31st March, 2011. Particulars under Section 2l7(l)(e) of the Companies Act 1956: The information as required under section 217(l)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 pertaining to energy conservation, technology absorption and foreign exchange earnings and outgo is given in the Annexure forming part of this report. Directors Mr. Sanjay Gaikwad and Mr. Rajiv Raje, Directors of the Company would retire by rotation at the ensuing Annual General Meeting of the Company and are eligible for the re-appointment During the year Mr. N. E. Narwade and Mr. Amish Patel were appointed as additional directors of the company by the Board of Directors on August 13, 2011. By virtue of Section 260 of the Companies Act, 1956, he holds office upto the date of the ensuing Annual General Meeting and is eligible for appointment. Mr. N. E. Narwade has been appointed by the Board as Whole Time Director of the Company for a period of three years with, effect from August 13, 2011. Necessary resolution has been proposed in notice of the ensuing Annual General Meeting for his appointment and payment of remuneration. Mr. Chandrashekhar Dhongde resigned as Managing Director of the Company with effect from July 1, 2011. He continues to be a director of the Company. Listing The shares of the Company are listed on Bombay Stock Exchange Ltd., Delhi Stock Exchange Ltd. The Company has paid the necessary listing fees for the year 2011- 12 to the Bombay Stock Exchange Ltd. The Company's application for delisting is pending with the Delhi Stock Exchange Ltd. CORPORATE GOVERNANCE Report on Management Discussion & Analysis and Corporate Governance and' a certificate' from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are attached-hereto and form part-of this Report Particulars of Employees The Company does not have any employee whose particulars are required to be given pursuant to the provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (particulars of Employees) Rules, 1975. Directors' Responsibility Statement Pursuant to section 217(2 A A) of the Companies Act, 1956 your Directors confirm the following a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same; b) that,the directors have selected such accounting policies and applied them , consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period; c) that the directors have taken proper and sufficient care for the maintenance of adequate accounting record in accordance' with 'the* provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and ' detecting fraud and other irregularities; d) that the directors have prepared the annual accounts on a going concern basis; Auditors The reference made by the Auditors in their report and notes to Accounts are self-explanatory and require 'no further explanation. M/ s. M.A. Parikh & Co. Chartered Accountants, Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re- appointment. Industrial Relations, The overall Industrial Relations in the Company have been cordial. Your Company has received full cooperation and support of its personnel. Your Directors thank them and expect the same support from them in the years to come. Acknowledgements The Board wishes to thank their customers, suppliers, Shareholders and the Bankers of the Company for their support and co-operation. For and on behalf of the Board November 24, 2011 Directors ANNEXURE TO DIRECTORS' REPORT Information as per 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 and forming part of Directors' Report for the year ended 31st March 2011. A) Energy Conservation a) Energy conservation measures: The Company has maintained unity power, factor through out the year. With the help of recuperators, cost analysers, flow meters and other temperature and pressure measurement cum control gauges, company had tried its best to conserve electricity as well as fuel which are the main energy sources. The Heat Treatment with polymer quenching and use of bio gas have also helped in further reduction in energy consumption b) Additional investment and proposal being implemented for Reduction in consumption of energy: The Company is in the process of modification of various furnaces. c) Impact of measures at (a) and (b) above for reduction of energy consumption and the consequent Impact on the cost of production: These measures have resulted in reduced consumption of fuel and also saving in power cost, inspite of substantial increase in the prices of the same. B) Power and Fuel Consumption at Nasik Factory for the manufacture of Forgings 2010-11 2009-10 2008-09 1) Electricity a) Purchase Units (KWh) 2659760 2927000 2601180 Total Amount Rs. 14351949 14400367 12035074 Rate Per Unit 5.40 4.91 4.63 b) Own Generation Nil Nil Nil Nil Nil Nil 2) Coal NIL NIL NIL 3) Furnace Oil Purchase quantity (K. Ltrs.) 1176758 1206471 1107466 Total Amount Rs. 31619428 34295371 27445656 Rate Per Unit 26.87 28.42 24.78 4.Light Diesel Oil (LDO) a) Purchase Qty (K. Ltrs.) 153147 39340 58880 Total Amount Rs. 7445260 1392663 2051186 Rate Per Unit 48.61 35.40 34.83 C) Consumption per unit of production Production Tonnage Electricity Furnace Oil LDO (In Rs. Per Ton) (In Rs. Per Ton) (In Rs. Per Ton) 2010-11 2009-10 2010-11 2009-10 2010-11 2009-10 2010-11 2009-10 4174 4812 3440.00 2996.84 7575.00 7127.05 178.37 289.41 D) There was no technology import during the period under review E) Foreign Exchange Earnings and Outgo 2010-11 2009-10 Foreign Exchange Earnings Rs.101.16 Lacs Rs.142.67 Lacs Foreign Exchange Outgo NIL NIL For and on behalf of the Board Mumbai November 24,2011 Directors MANAGEMENT DISCUSSION AND ANALYSIS INDUSTRY STRUCTURE AND DEVELOPMENT: BCL Forgings Limited is in the manufacturing of carbon & alloy steel forging components required for various types of Industries - predominantly to the Automobile Industry. The Company has successfully completed its expansion programme and presently is in the process of development of various components for auto as well, as non-auto Industries viz. Windmill Energy, Earth Moving Equipment, Mining, Hydraulics, Agriculture and export related customers. OPPORTUNITY, AND THREATS, OUTLOOK, RISK AND CONCERNS Currently the Company's plant is not fully operational due to lack of working capital & implementation of new techniques arid renovation and opportunities and threats depend on the full operation of the plant. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: The Company has in place adequate internal control systems and procedures commensurate. with the size and nature of its business. These procedures are designed to ensure: * That all assets and resources are used efficiently and are adequately protected; * That all internal policies and statutory guidelines are complied within letter & spirit * The accuracy and timing of financial reports and management information. FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE: The Company has made net loss of Rs. 852.51 lakhs after Provision of Depreciation of Rs.123.10 lakhs and interest of Rs. 596.12 lakhs and carried forward a loss of Rs. 2030.01 lakhs to the Balance Sheet after setting off brought forward loss of Rs. 1177.49 lakhs of previous year. MATERIAL DEVELOPMENT IN HUMAN RESOURCES INDUSTRIAL, RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED: Human' Resources are the strength of the Company and the Company has put in place various systems to reward and recognize employee contribution towards the growth of the Company. Your Company has a team of qualified and dedicated personnel who have contributed to the growth of the Company. Your Company's industrial Relations continued to be harmonious during the year under review. CAUTIONARY STATEMENT: Statement in the Management's Discussion and Analysis describing the Company's projections, estimates, expectations or predictions within the meaning of applicable securities, laws and regulations. These forward looking statements are based on certain assumptions and expectations of future events over which the Company exercises no control. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. Actual results may differ materially from such estimates, projections etc. whether expressed or implied.