You are here » Home » Companies » Company Overview » Fineotex Chemical Ltd

Fineotex Chemical Ltd.

BSE: 533333 Sector: Industrials
NSE: FCL ISIN Code: INE045J01026
BSE 00:00 | 18 Jun 88.40 -1.20






NSE 00:00 | 18 Jun 88.70 -0.90






OPEN 91.40
VOLUME 119424
52-Week high 95.90
52-Week low 24.90
P/E 27.20
Mkt Cap.(Rs cr) 979
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 91.40
CLOSE 89.60
VOLUME 119424
52-Week high 95.90
52-Week low 24.90
P/E 27.20
Mkt Cap.(Rs cr) 979
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Fineotex Chemical Ltd. (FCL) - Director Report

Company director report

Dear Shareholders

We have pleasure in presenting the Sixteenth Annual Report together with the AuditedStandalone Financial Statements of the company for the financial year ended 31st March2019.


The year under review witnessed stagnancy both within the country as well as globally.Your Company utilized the situation to increase the market share. This was done as afocused activity both locally and globally. Operating Income increased 22% on standalonebasis and 27% on consolidated basis. With the improving world scenario the profitabilityis certain to be reflected in future.


(Rs. in Lakhs)



Year ended 31-03-2019 Year ended 31-03-2018 Year ended 31-03-2019 Year ended 31-03-2018
Total Income 11431 9943 18388 14810
Less: Expenditure 8885 6929 14971 11418
Profits before Tax 2546 3014 3417 3392
Less: Income Tax Expense 760 886 930 995
Less Exceptional Items 53 - 53 -
Profit after Tax 1733 2128 2434 2397
Other Comprehensive Income (net of tax) (1) 1 (1) 1
Total Comprehensive Income 1732 2129 2433 2398

The above data has been extracted from the Standalone and Consolidated FinancialStatements prepared in accordance with the Indian Accounting Standards (IndAS) as notifiedunder section 133 of the Companies Act 2013 read with Companies (Indian AccountingStandards Rules 2015) and the relevant provisions of the Act as applicable. The Board ofDirectors have recommended a final dividend of Rupee 0.10 per share which will be paidwithin the stipulated time after your approval at the ensuing Annual General Meeting.


The year under review was the first full year since the introduction of Goods andServices Tax (GST). The Company’s motto was to expand the market reach and hassuccessfully achieved a volume growth of over 30%. With the improved economic conditionsthe bottom line will be better in the coming years. The Company’s efforts ofconsolidating its production and marketing infrastructure have shown positive resultswhich are set to accelerate in coming quarters. The Company’s exports have reached 60countries against 40 last year and the trend continues. The reach to remote pocket isincreasing even in domestic markets.

The Company’s thrust continues to concentrate on new markets and pioneering newproducts to enhance the operational efficiency of the customers. The Company hasstrengthened its human recourses to tackle the needs of the customers with entrepreneurialzeal. This commitment is total and coupled with its focused drive to achieve growththrough better management of both materials and overheads. The Company has recorded anincrease in turnover of 22% on standalone basis while the consolidate turnover showed amoderate rise due to more efforts on development of products. This will show results inthe coming quarters.

The exports contribute over 22% of its operations on a standalone basis. The Companyhas also reached an advance stage in production of products which would foray theCompany’s operations in to new sector thereby widening and diversifying itsactivities.


The paid-up equity share capital of the Company as on 31st March 2019 stood at Rs.222600000 comprising of 111300000 equity shares of Rs. 2/- each. During the yearunder review there was no change in the Share Capital of the Company.


The Board of Directors has recommended a final dividend for the current financial yearand the Board recommends your approval.


The summary of performance of the subsidiary companies is provided below:

a. Foreign Subsidiaries:

Fineotex Malaysia Limited (FML) a Limited Company was incorporated in Labaun Malaysiain 2011. FML in turn has controlling interest in 3 other companies in Malaysia that haveestablished manufacturing and trading activities. These Companies are BT Biotex Sdn BhdBT Chemicals Sdn Bhd and Rovatex Sdn Bhd. The synergy of the businesses has helped all thecompanies. These investments will complete 8 years in June 2018.

Fineotex Specialities FZE was incorporated in the Region of UAE on 25th January 2015.

b. Indian Subsidiaries:

Manya Steels Private Limited is the only Indian subsidiary. It was acquired fordiversification. The Company would commence commercial operations in the future. It is nota material subsidiary as per the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015

Pursuant to the provisions of Section 129(3) of the Companies Act 2013 a statementcontaining salient features of financial statements of subsidiary companies in Form AOC 1is attached to the Accounts.

The separate audited financial statements in respect of each of the subsidiarycompanies shall be kept open for inspection at the Registered Office of the Company duringworking hours for a period of 21 days before the date of the Annual General Meeting.


There have been no significant changes or commitments affecting the financial positionof the Company which has occurred after the Balance Sheet date and the date of adoption ofthe Board Report.

During the year under review and till the date of the Board Report there are nonematerial / significant orders passed by the regulators or appellate authorities that mayaffect the going concern status of the Company’s future operations.


The Internal Control System is reviewed on a continuous basis in the light of changedcircumstances and way of doing business due to the changing systems and procedures. YourCompany has an effective system of receipt storage and utilization of materials-especially in the environment in which the Company operates. This is reflected in itsInternal Financial Controls. The interventions of the Top Management in the Controlprocesses is significantly required due to peculiar business environment of making tailormade products. Its products are not standardized but each supply has to meet therequirements of the customer on his shop floor. This is backed by quality control at eachstage. It has also in place adequate accounting administrative logistics and system ofinternal check and controls to ensure safety and proper recording of all assets of theCompany and their proper and authorized utilization. The Company constantly reviews itsadherence to the environmental norms. The Company has its own Internal Control system andthe Audit Committee reviews its adequacy from time to time. Measures are taken tostrengthen the same and check its effectiveness.


The Consolidated Financial Statements of the Company along with its subsidiaries - bothforeign and Indian - for the year ended 31st March 2019 form part of this Annual Report.The same are prepared as per the applicable Indian Accounting Standards (Ind AS) asnotified under section 133 of the Companies Act 2013 read with Companies (IndianAccounting Standards Rules) 2015 and the relevant provisions of the Act as applicable.


The Company has not accepted any deposits from the public or the shareholders duringthe year or in the previous year. Security Deposits have been taken from the customers asa security against dues for goods sold to them and are not in the opinion of the Board inthe nature of Public Deposits. Rent Deposit given to Subsidiary Company is disclosed inthe financial statements as required under the Indian Accounting Standards (Ind AS) andListing Agreements.


The Particulars of loans guarantees and investments under Section 186 of the CompaniesAct 2013 as at the end of the Financial Year 2018-19 are provided in the standalonefinancial statements and the same are also given in Annexure ‘1’ formingpart of this report.


All Related Party Transactions entered into during the year were on arm’s lengthbasis and were in the ordinary course of business. There are no materially significantrelated party transactions made by the Company with Promoters Directors Key ManagerialPersonnel or other designated persons which may have a potential conflict with theinterest of the Company at large.

All Related Party Transactions are approved by the Audit Committee. Prior omnibusapproval is obtained from the Audit Committee in respect of transactions which arerepetitive in nature.

The shareholders have also given the approval to these contracts and transactions atthe 12th and 13 th Annual General Meeting of the Company.

Details of related party transactions are given in Annexure ‘2’ givingthe details as per AOC-2

The policy on Related Party Transactions as approved by the Board is available on thewebsite of the Company www.fineotex. com and may beaccessed through the web link


Mrs. Aarti Jhunjhunwala is liable to retire by rotation at the ensuing Annual GeneralMeeting and being eligible she offers herself for re-appointment. She is related to theWhole-time Directors of the Company and therefore a Non-Independent Director liable toretire by rotation and being eligible she offers herself for reappointment.

The details about her are attached separately.

Mr. Manmohan Mehta and Mr. Alok Dhanuka Independent Directors were appointed as perSection 149 of the Companies Act 2013 in 2014 for a period of five years. Their termexpires in September 2019. The Board recommends for their re-appointment for the secondterm of 5 years. The Board has received their eligibility and consent for re-appointment.The other details are given in the notice to the Annual General Meeting.


During the year under review there has been a change in the Board of Directors of theCompany. Ms. Ritu Gupta has resigned from the Board with effect from 14th August 2018.Mrs. Aarti Jhunjhunwala was appointed as an Executive Director of the Company with effectfrom 14th August 2018. The Board of Directors of the Company met six times during thefinancial year. The details of various Board Meetings are provided in the CorporateGovernance Report given in the Annexure ‘C’.


Key Managerial Personnel (KMP)

The following have been designated as the Key Managerial Personnel of the Company asper the Companies Act 2013 read with the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014:

a) Mr. Surendrakumar Tibrewala - Chairman & Managing Director

b) Mr. Sanjay Tibrewala - Executive Director & Chief Financial Officer

c) Ms. Pooja Kothari - Company Secretary (since 04/04/2018)

Particulars of Employees and related disclosures

None of the employees who were employed throughout the financial year was in receipt ofremuneration of more than Rs. 10200000 during the year ended 31st March 2019 nor wastheir remuneration in excess of that drawn by the Managing Director or Whole-timeDirector.

There were no employees employed for any part of the financial year 31st March 2019 inreceipt of remuneration more than Rs.850000 per month nor was their remuneration inexcess of that of Managing Director and Executive Director.

Disclosure with respect to the remuneration of Directors KMPs and employees asrequired under section 197 (12) of the Companies Act 2013 read with Rule 5 (1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are given in Annexure‘3’ to this Report.


The Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in Section 149(7) of the Companies Act 2013 soas to qualify themselves to be appointed as Independent Directors under the provisions ofthe Companies Act 2013 and the relevant rules.


In line with the principles of transparency and consistency your company has adoptedthe Nomination and Remuneration Policy which inter alia include criteria for determiningqualifications positive attributes and independence of a Director. The Remunerationpolicy is set out in the Annexure ‘4’ to the Director’s Report andis also available on the Company’s website.


In compliance with the requirements of the erstwhile Listing Agreement with the stockexchange ("Listing Agreement") and SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 the Company had conducted a Familiarization Program on12th February 2019 for the Independent directors to familiarize them with the Companytheir roles rights responsibilities in the Company nature of the industry in which theCompany operates entitlement of sitting fees to independent directors etc. The details ofsuch programme are available on the website of the Company The Company also circulates explanatory notes on amendments made tovarious applicable laws and regulations.


Pursuant to the provision of the Companies Act 2013 and

Regulations 17 (10) and 25(4)(a) of the Listing Regulations the Nomination andRemuneration Committee formulated a framework containing inter-alia the criteria forperformance evaluation of the entire Board of Directors of the Company includingindependent directors. The performance evaluation of Audit Committee was also carried out.

The Evaluation of Board and its findings were shared by the Chairman individually withthe Board Members. The Directors expressed their satisfaction with the evaluation process.


M/s. UKG Associates Chartered Accountants (Firm Registration No. 123393W) wereappointed as statutory auditors of the company at the 11th Annual General Meeting for aperiod of 5 years - i.e. till the conclusion of 16th Annual General Meeting to be held in2019. As they have been auditors for the last ten years they are not eligible forre-appointment. Accordingly as per the said requirements of the Act M/s. ASL & Co.Chartered Accountants (Firm Registration No. 101921W) are proposed to be appointed asauditors for a period of 5 years commencing from the conclusion of 16th AGM till theconclusion of the 21st AGM to be held in 2024.

M/s. ASL & Co. Chartered Accountants (Firm Registration No. 101921W) haveconsented to the said appointment and confirmed that their appointment if made would bewithin the limits specified under Section 141(3)(g) of the Act. They have furtherconfirmed that they are not disqualified to be appointed as statutory auditors in terms ofthe provisions of the proviso to Section 139(1) Section 141(2) and Section 141(3) of theAct and the provisions of the Companies (Audit and Auditors) Rules 2014.

The Audit Committee and the Board of Directors have recommended the appointment of M/s.ASL & Co. Chartered Accountants (Firm Registration No. 101921W) as statutoryauditors of the Company from the conclusion of the 16th AGM till the conclusion of 21stAGM at a remuneration of Rs. 400000/- p.a. excluding taxes and out of pocket expensesfixed by the audit Committee and Board of Directors of the Company. Also the Company hasalso received their eligibility and consent to act as statutory auditors. They have alsoprovided the Peer Review Certificate as required by SEBI Regulations.

Further the Auditors’ Report for the financial year ended 31st March 2019 on thefinancial statements of the Company is a part of this Annual Report. The Auditors Reportfor the financial year ended 31st March 2019 does not contain any qualificationreservation or adverse remark.


In pursuance of Section 148 of the Companies Act 2013 and Rule 14 of the Companies(Audit and Auditors) Rules 2014 every company specified in item (B) of Rule 3 shall getits cost records audited in accordance with these rules if the overall annual turnover ofthe company from all its products and services during the immediately preceding financialyear is rupees one hundred crore or more and the aggregate turnover of the individualproduct or products or service or services for which cost records are required to bemaintained under rule 3 is rupees thirty five crore or more.

The overall annual turnover of your company from all its products and services during2018-19 (the immediately preceding financial year) has exceeded rupees one hundred croreand as such it is required to appoint a cost auditor and get its cost records audited.

The Board shall appoint an individual who is a cost accountant in practice or a firm ofcost accountants in practice as cost auditor on the recommendations of the AuditCommittee. The remuneration of Rs. 40000 per annum plus applicable taxes andreimbursement of travel and out of pocket expenses as recommended by the Audit Committeeshall be considered and approved by the Board of Directors and ratified by theshareholders. The Company has received their consent and eligibility certificate to act ascost auditors.

On the recommendation of the Audit Committee at its meeting held on 14th May 2019 theBoard has considered and approved the appointment of M/s V J Talati & Co. CostAccountants for the conduct of the Cost Audit of the Company’s manufacturing unitsat remuneration as mentioned above. . Also the Company has also received their eligibilityand consent to act as statutory auditors. The remuneration of Rs. 40000 per annum plusapplicable taxes and reimbursement of travel and out of pocket expenses as recommended bythe Audit Committee approved by the Board of Directors and ratified by the shareholders


As per Section 204 of the Companies Act 2013 and Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 it is mandatory for the Listed Companylike yours to have the secretarial records audited. The Board of Directors had appointedHS Associates Company Secretaries as Secretarial Auditors for 2019-20.

The Secretarial Audit Report is annexed herewith as Annexure ‘5’.

The Secretarial Audit Report for 2018-19 does not contain any qualificationreservation or adverse remark.


In compliance with the requirements of section 135 of the Companies Act 2013 read withCompanies (Corporate Social Responsibility) Rules 2014 mandates that your Company spendsat least 2% of its average last 3 years net profit after tax on Corporate SocialResponsibility (CSR) Activities and explained therein. This was the fourth year ofcompliance for your Company the Company has formed a Committee which has gone through therequirements and decided to carry out the same through the Trust who carry out theseactivities. The Company had to Spend Rs. 45.54 Lakhs in 2018-19. However it has spent Rs.47.00 Lakhs till 31st March 2019.

Details of CSR is annexed herewith as Annexure ‘6'


As per Regulation 21 of (Listing Obligation and Disclosure Requirements) Regulation2015 the provisions of Risk Management Committee is not applicable for your Company.However the management of the Company is determining various aspects so as to be able tominimize the risk in all spheres of the Company’s business from finance humanresources to business strategy growth and stability.


The details pertaining to composition of audit committee are included in the CorporateGovernance Report which forms a part of this Report.


The Company has established a vigil mechanism for Directors and employees to reporttheir genuine concerns details of which have been given in the Corporate GovernanceReport annexed to this Report. The copy of the Policy is available on the website of theCompany and may be accessed through the web link

No complaints/suggestions were received during the year.


The Company has 151 employees at the year end including whole time directors. We areequal opportunity employer and over 20% are women. We consider our employees as our mostvaluable asset and have been working towards keeping them engaged and inspired. Thecurrent workforce structure has a good mix of employees as all levels. The Company isaware that the success of its business depends upon its technical expert’scocoordinating with research and development staff on the one hand and marketing on theother. Necessary training and orientation is provided to our employees to equip them inproviding productive and committed results.


The Information on conservation of energy technology absorption and foreign exchangeearnings and outgo as required to be disclosed pursuant to the provisions of Section134(3)(m) of the Companies Act 2013 read with Rule 8 of the Companies (Accounts) Rules2014 is given to the extent applicable in Annexure ‘A' forming part of thisreport.


The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013. Internal Complaints Committee has been set up to redress complaints receivedregarding sexual harassment. All employees (permanent contractual temporary &trainees) are covered under the policy.

The following is a summary of sexual harassment complaints and disposed off during theyear 2018-19

No of Complains received: NIL

No of Complaints disposed off: NIL


The Management Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 (3) of the SEBI (LODR) Regulations 2015 on the operations of theCompany as prescribed under Schedule V is presented in a separate section forming part ofthe Annual Report Annexed as Annexure ‘B’.


Your Company would strive to set and achieve appropriate Corporate Governancepractices. In accordance with the requirements of Schedule V read with Regulation 34(3) ofSEBI (Listing Obligation and Disclosure Requirements) Regulations 2015 with the StockExchange a report on the status of compliance of corporate governance norms is alsoattached as Annexure ‘C’. A certificate from the Statutory Auditors ofthe Company confirming compliance with the conditions of Corporate Governance asstipulated in the Listing Regulations forms part of the Annual Report.


To the best of their knowledge belief explanation and information obtained by themand as required under Section 134(3)(c) of the Companies Act 2013 your Directors confirmthat:

(i) in the preparation of the Annual Accounts the applicable accounting standards havebeen followed along with proper explanations relating to material departure if any;

(ii) they have selected such accounting policies as mentioned in Note 2 to the Notes toFinancial Statements and applied them consistently and made judgments and estimates thatare reasonable and prudent so as to give a true and fair view of the state of affairs ofthe Company at the end of the financial year and of the profit of the Company for thatperiod;

(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 fraud and otherirregularities;

(iv) they have prepared the annual accounts on a going concern basis;

(v) the proper internal controls were in place and that the financial controls wereadequate and were operating effectively and

(vi) the systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.


Pursuant to sub-section 3(a) of section 134 and sub-section (3) of section 92 of theCompanies Act 2013 read with Rule 12(1) of the Companies (Management and Administration)Rules 2014 an extract of the Annual Return as on 31st March 2019 in Form No. MGT 9 isattached herewith as Annexure ‘7’ and forms part of this Report.


Your Directors place on record their sincere appreciation to the Central Governmentthe State Governments all its investors stakeholders & bankers all the businessassociates for the cooperation and support extended to the Company. Your Directors alsowish to place on record their deep appreciation to the employees for their hard workdedication and commitment extended to it throughout the year.

For and on behalf of the Board

Surendrakumar Tibrewala Sanjay Tibrewala
(Chairman & Managing Director) (Executive Director)
DIN: 00218394 DIN: 00218525
Place : Mumbai
Dated: 4th June 2019

Annexure A

Disclosure of particulars with respect to Conservation of Energy Technology Absorptionand Foreign Exchange Earnings and Outgo as prescribed under Rule 8(3) of the Companies(Accounts) Rules 2014


(a) Energy conservation measure taken - Energy consumption is not very high for theCompany’s business. However efforts are being continuously made of monitoring theconsumption and reduction of losses to reduce energy costs.

(b) Total energy consumption and energy consumption per unit of production as per Form‘A’ attached hereto

Form ‘A’
Power & Fuel Consumption 2018 -19 2017 -18
1. Electricity
Purchased Units (Nos) 181497 173279
Total Cost (Rs.) 1676 498 1434173
Rate / Unit (Rs.) 9.24 8.28
2. Diesel Oil
Quantity (K.Ltrs) 5436.62 6195.98
Total Cost (Rs.) 395998 390448
Average rate per K Ltr. (Rs.) 72.83 63.02


(a) Efforts made in technology absorption - as per Form B given below

Form ‘B’

Research and Development (R & D)

1. Specific areas in which the research and development (R & D) is being carriedout by the Company - There has been no major expenditure in what is generally understoodas Research and Development. However it is our continuous endeavour to improve theperformance of products as well as develop new products mainly as required by thecustomers.

2. Benefits derived as a result of the above R & D - Developed few products as wellas improved performance of certain products to meet the customer requirements

3. Future plan of action - No major plan is on anvil but development to suit thecustomer’s requirements and satisfaction is the main back bone of our businessactivity.

4. Expenditure on R & D - Not significant during the year on in immediate future.

Technology absorption adoption and innovation

1. Efforts in brief made towards technology absorption adoption and innovation - theinitiatives leading to development or improvement and continuously adopted intoproduction. The Company has not taken any technical knowhow from outsiders.

2. Benefits derived as a result of the above efforts - there are improvement inprocess cost reduction reduction in the production process cycle time.

3. Information regarding Imported Technology - We have no imported technology


Activities relating to export initiatives to increase exports developments of newexport markets for products.

Sr.No Particulars 2018-19 2017-18

Rupees in Lakhs

(a) Total Foreign exchange earned 2458.24 2350.27
i. Sales - Export 2458.24 2094.15
ii. Dividend - 256.12
(b) Total Foreign exchange used 1378.27 836.38
i. Commission 114.31 79.84
ii. Travelling 17.69 15.47
iii. Exhibition 6.45 3.53
iv. Import 1231.32 737.54
v. Professional Fess 8.50 -

Annexure ‘B’ to the Directors Report


The last couple of years the Global Economy was not having any visible signs of growthand hope. The Indian scenario was no different. In fact it was affected by some stringentmeasures taken by the Government of India in the form of Demonetization and Introductionof Goods and / or Services Tax. There was movement in the positive direction but marginal.

Specialty chemicals are made for a specialized use. No specific definition is availablefor specialty chemicals. In general it can be described as chemicals with high value andlow volume which is used as performance enhancing properties. Additives adhesivescorrosion inhibitors dyes lubricants and pigments are a few to name.

Manufacturers and retailers work on a frantic pace to make and sell trendy garments atcompetitive prices. With today’s fashion apparels have to be both functional andstylish. Growing demands in the customer expectations and distinct performancerequirements in the end user industries require focus on providing product and applicationknow-how to the ultimate consumers. Attempts made by businesses to come up with innovativesolutions manipulate the market for specialty chemicals.

During the process of manufacture textiles go through various chemical treatments.This includes pretreatment dyeing and refinement of textiles. Special chemicals such asflame retardants water repellents and warp sizes are used in this process. More thansixty different textile chemicals are used in various textile processes like yarnformation fabric pretreatment laminating finishing and coating. Textile dyes andchemicals segment is the largest component of the chemicals industry. Dyestuff segment isthe biggest industry due to its forward and backward linkages with versatile applicationsin textiles leather printing inks paper etc.

There is a steady growth in the economy since 2012 there has been a gradual growth inthe economy. The trend of overall growth in the economy. This growth has a positive effecton the textile industry which in turn augurs well for the textile chemicals in which weoperate. It is forecasted that this trend would continue at least for the next few years.

During the last few years the consumption pattern in the various regions have more orless remained similar. There is a minor percentile reduction in 2018 over 2015 in Chinawhich is the major consuming country accounting nearly half of the world consumption.During the corresponding period the consumption show a small percentage rise in India.Significant increase has taken place in neighboring Pakistan.

The type of product would vary according to the users of such chemicals. In USA andEurope the demand is more for apparel and high end fashion. Thus the product range ismainly finishing chemicals which have specific requirements in the end products. Thetextile speciality chemical segment has witnessed M&A activity driven by market accessand consolidation opportunities.

Scene in India

The main driver that spurs the specialty chemical business is the production oftextiles. The provision figures released by the Ministry of Textiles upto 2018-19 showsthe trend as under

Estimated Production of man-made fibre filament yarn spun yarn and cloth.

(Fig. in millions)


Man-made fibre

Man-made filament yarn

Cotton yarn

Blended & 100% Noncotton yarn

Total Spun Yarn


Mill sector * Decentralized sector ** Grand Total (Exc. Khadi Wool & Silk)
Kg Kg Kg Kg Kg
2015-16 1347 1164 4138 1527 5665 2315 62269 64584
2016-17 1364 1159 4055 1604 5659 2264 61216 63480
2017-18 1319 1187 4064 1616 5680 2157 64688 66845
2018-19 (P) 1443 1155 4182 1680 5862 2012 68034 70046
% Variation 2018-19 over 2017-18 9.4 -2.7 2.9 4.0 3.2 -6.7 5.2 4.8


> P - Provisional

> * - Based on statistical data received from units

> ** - Based on set of conversion ratio of yarn to fabric

India is the second largest exporter of textiles globally. Stringent environmentalregulations in China have forced several dye manufacturers to shut down their plants. Thishas enabled Indian players to penetrate the international market. Various governmentinitiatives are being taken to encourage the country’s textile production. One of theinitiatives was taken by the Maharashtra state government to establish nine textile parksto aid the domestic manufacturing market.

Majority of manufacturers in India have shifted their focus towards investing inproduct innovation supported by the Make in India scheme of the government. The demand forapparel with diverse textures and designs is majorly attributed to the aspirational youthwhich constitutes the major part of the Indian population. Growing consumer disposableincome coupled with increasing adoption of casual clothing is expected to enhance theclothing demand over the forecast period.

Environmental concerns associated with textile chemicals have shifted the focus ofmajor manufacturing companies toward green (bio-based) chemicals which are eco-friendlyin nature. Green chemicals are produced using animal and plant fats/oils which not onlymakes them ecofriendly but also cost-efficient as compared to their conventionalcounterparts. Companies involved in manufacturing bio-based chemicals offer costcompetitiveness owing to the availability of low-cost feedstock.

The basic role of the textile auxiliary chemicals is to improve the processingperformance. There is some imperfection in each product for every user and hence theseproducts are called Specialty Chemicals. These products are low volume high marginproducts which form the minisule part of the total cost as well as weight of the textiles.

Global consumption of textile chemicals grew 2.8% per year on a volume basis during2012-15. Future growth will depend on the fortunes of the textile industry. It is expectedto reach $27560 million by 2022 from $21770 million in 2015 and growing at a CAGR of3.4% from 2016 to 2022.

The significant impacting factors in the textile chemicals industry include developmentof apparel industries due to increase in demand for consumers and growth in population.Along with these factors the market is influenced by the increase in demand for homefurnishing products evolution of environmental friendly chemicals required by textilesindustries and development of packaging industries which require large textilechemicals.

Boosting growth will be the rising level of personal income in both developed anddeveloping countries which will promote the production of textiles used in apparelupholstery household furnishings and floor coverings. While colorants and auxiliarieswill remain the biggest product segment faster gains will be seen in finishing chemicalswhich impart specific aesthetic physical and functional properties to textiles. The Asia/

Pacific region China and India in particular will continue to be the largest consumerof textile chemicals and is also forecast to experience the fastest growth.

On-going advancements in the textile chemicals market due to innovative efforts havefurther enhanced the efficiency of these chemicals. The report includes textile chemicalmarket forecast from 2016 to 2022. To understand the market drivers restraints andopportunities are explained in the report. Further the key strategies adopted bypotential market leaders to facilitate the effective planning are also discussed under thescope of the report. The market value and volumes are further derived using bottom-upapproach and by considering price trends.

Textile Chemicals and Fineotex

Fineotex Chemical Limited (FIneotex) is fast emerging as a major Company whichmanufactures a range of specialty chemicals. It is the fastest growing chemical Company inIndia in the manufacturing sectors. It has crossed an annual turnover of Rs. 100 crores.It produces speciality textile chemicals which in general can be described as chemicalswith high value and low volume which are used for their performance enhancing properties.Due to a staggered growth in the economy - both local and global - during the yearFineotex used this period to achieve expansion in its area of operation as well asincrease the market share. There has been increase in exports - value countries andproducts. Similarly specific trust was made in domestic market to add new customers newproduct and new regions. The result was visible in the form of increased volume. Withimproved economic conditions the bottomline will grow faster.

The SWOT Analysis


The ability of Fineotex to adapt to the changing environment across markets is itsstrength. It is based on its experience in this business for over 40 years backedproduction expertise. To further augment this on a continuous basis Fineotex ensureadequate capacities and proper facilities trained and dedicated staff to maximize theconsumer satisfaction by improving the process performance and anticipate thecustomers’ needs and solve the same. Fineotex is known amongst its ever increasingcustomers as Dependable.


The Company’s customers expect that the Fineotex’s products and philosophy tocontemplate on their needs look for solutions and work with them to solve the issues. Thedelay however unavoidable could affect the business adversely. However the inherentstrength of Fineotex and dedicated commitment by the staff proven by the previous historyhas demonstrated that such threats are tackled successfully and converted intoopportunity.


The staggered growth of the recent past has been utilised to expand the market as wellas the reach. The economic conditions are used to introduce new product on the one handand also increase the area opf operation. There is great opportunity to expand globallyand the Company has already achieved during the year and would follow it in future.


The present uncertainties of trade wars and the protectionist policies of major nationsin the Global Economy is a matter of concern. However it is not likely to cause any majorimpact on the Company. The Company’s product are tailor made to the customers’requirements and the name guarantees quality and dependability. Hence except forunforeseen circumstances like acts of God the Company does not foresee any threats to theCompany’s business and the area of its operations.


Economic Growth is driven by domestic demand for quality textiles and exports of highquality textiles. With improved economic condition the outlooks is bright.

With increased quality requirements the demand for specialty products will increase.Fineotex has also focused its thrust on finishing chemicals which demand high quality andefficiency with varying consumer demands. These are challenging opportunities withcommensuration high margins. Fineotex awaits for these opportunities to unfold.

At a group level it has developed an eco friendly product that controls mosquitooutbreak. Approvals are sought from the authorities globally from the HealthOrganizations. The processes are in the advance stage of approval and it is taking longerthan expected. The Company is also increase its product range in the field of agrochemicals. This is a separate area of health care which will give both value and volumesale to the Company in the coming years.


During the year the turnover of the Company has grown to Rs.11263.36 Lakhs ascompared to Rs. 9187.62 Lakhs for FY 2017-18 resulting in growth of 22%. The Company is azero debt Company with no borrowings for its local operations. Short term borrowings arerestricted to need based working capital requirements. Employee benefit expense increasedto Rs. 590.97 Lakhs during the year as against Rs. 462.69 Lakhs in the previous FY2017-18. The increase in staff was due to additional production facilities and marketingneeds.

The salient indicators are as under:-



2018-19 2017-18 2018-19 2017-18
Income from Operations 11263.63 9187.63 18232.73 14292.68
PBT 2492.65 3014.15 3416.51 3392.08
PAT 1732.29 2128.15 2433.25 2396.64
EPS (of Rs 2/-) (Basic & Diluted) 1.56 1.91 2.02 2.04

During the year under review the plant had smooth operations.

As per the Accounting Standard 17 issued by the Institute of Chartered Accountants ofIndia and Companies (Accounting Standards) Rules 2006 the Company has only one segmenti.e. specialty or auxiliary chemicals and preparations which are mainly used in textileprocessing. The Company’s products play an important role in the textilemanufacturing processes. With the cautious growth expected in the textile industry in thecoming year with increasing demand for chemicals needed for this industry based on theincreasing expectation of quality and fashionable textile products the Company expects agrowth in turnover for the current year. However the margins continue to be under stress.The total quantitative sales in 2018-19 were 13005 MT against 10094 MT in 2017-18. It ispertinent to note that quantity is not a very indicative criteria to evaluate performanceas the quantity may vary depending upon the concentration level of products sold.

The Company’s financial performance continues to be sound and getting Sounder. TheCompany is almost a zero debt company. The net worth has increased by over 14%. TheDebtors have shown a minor increase due to higher sales in the last quarter. The otherparameters like inventory operating margins are comparable the best in the industry. Thestress this year was on expanding the market size to ensure profitability on improvementin demand. The salient ratios are as under:

Details of significant changes (i.e. change of 25% or more as compared to theimmediately previous financial year) in key financial ratios.

SR NO Ratios



2018-19 2017-18 2018-19 2017-18
(i) Debtors Turnover (times) 3.26 4.14 3.71 5.12
(ii) Inventory Turnover (times) 8.16 7.73 1.96 1.32
(iii) Interest Coverage Ratio (number) 44.66 77.75 30.12 37.06
(iv) Current Ratio (times) 3.36 2.69 0.02 0.02
(v) Debt Equity Ratio (times) 54.52 24.13 0.35 0.53
(vi) Operating Profit Margin (%) 22.64 33.23 3.43 3.50
(vii) Net Profit Margin (%) 15.21 21.41 0.18 0.13
(viii) Net Worth 13842.58 12110.71 16517.49 14190.13


The Internal Control System is reviewed in the light of changed circumstances and wayof doing business especially after the introduction of Goods and Services Tax. YourCompany has an effective system of receipt storage and utilization of materials -especially in the environment in which the Company operates. This is reflected in itsInternal Financial Controls. The interventions of the Top Management in the Controlprocesses is significantly required and this is provided by them. Its products are notstandardized but each supply has to meet the requirements of the customer on his shopfloor. This is backed by quality control at each stage. It has also in place adequateaccounting administrative logistics and system of internal check and controls to ensuresafety and proper recording of all assets of the Company and their proper and authorizedutilization. The Company constantly reviews its adherence to the environmental norms. TheCompany has its own Internal Control system and the Audit Committee reviews its adequacyfrom time to time. Measures are taken to strengthen the same and check its effectiveness.


The Company has 115 employees at the year end including whole time Directors. We areequal opportunity employer. Out of the total strength over 20% are women. We consider ouremployees as our most valuable asset and have been working towards keeping them engagedand inspired. The current workforce structure has a good mix of employees as all levels.The Company is aware that the success of its business depends upon its technicalexpert’s co-coordinating with research and development staff on the one hand andmarketing on the other. Necessary training and orientation is provided to our employees toequip them in providing productive and committed results.

For and on behalf of the Board
Surendrakumar Tibrewala Sanjay Tibrewala
(Chairman & Managing Director) (Executive Director)
DIN: 00218394 DIN: 00218525
Place : Mumbai
Date: 4th June 2019