JMP CASTINGS LIMITED
ANNUAL REPORT 2005-2006
The directors of your Company wish to present the 16th Annual Report on the
Company together with Audited Statement of Accounts and Auditors' Report
thereon for the year ended 31st March, 2006.
The financial year 2005-06 has ended by leaving a profit of Rs.10.42 Lakhs
as against last year profit of Rs.0.95 lakhs. Though there is decrease in
production, but margin decline in sales due to change in product mix, being
more emphasis on production of motor vehicle parts.
THE YEAR IN REVIEW:
Product Name 2005-06 2004-05
C.I Castings 63 152
SG Iron Castings 55 283
M.V. Parts 1042 1017
Total (MT) 1160 1452
The sales during the current year was Rs.594.00 Lakhs (previous year
Rs.610.08 Lakhs). The company is in negotiation with more customers in
castings and M.V. component segment as a result of which the sales are
likely to improve in next year.
Your Company is now a debt free company as there are no liabilities towards
any financial Institute.
Despite of the adverse market scenario, as aforesaid, your Company proposes
to increase the business of castings, machined castings and M.V. Parts by
exploring new more customers and new areas for which, steps have already
been taken up. Thus, a increase in business of your company is anticipated
in the next financial year.
STOCK EXCHANGES & LISTING FEES:
The shareholder may note that your company is listed with Ludhiana Stock
Exchange. The Stock Exchange. Mumbai. The Ahmedabad Stock Exchange.
Calcutta Stock Exchange and Delhi Stock Exchange. The arrears of listing
fees shall be paid in short time.
In view of marginal profit to the company, the Board of Directors have not
recommended payment of dividend this year.
ENERGY CONSERVATION AND TECHNOLOGY ABSORPTION:
Due importance has been given to energy conservation and development
programs. The statutory details in respect of energy conservation and
foreign exchanges outgo pursuant to Rule 2 of Companies (Disclosure of
Particulars in Report of Directors) Rule 1988 are annexed to the Report.
In accordance with the provisions of Companies Act, 1956 and Company's
Articles of Association, S/Sh. Rajinder Kapoor, Jatinder Kapoor & Mrs.
Nirmala Kapoor directors of the Company are to retire by rotation and being
eligible has offered themselves for reappointment.
During the financial year, all the members of the board & the members of
the senior Management had complied with the code of conduct formulated by
the Board. The declaration for the same has been given by the Managing
Director of the Company and is annexed herewith as Annex-1.
OPPORTUNITY AND THREATS:
With the increase in demand of castings and auto components sector the
company is getting inquiries of its products from all segments especially
tractor, automobile and pipe fitting industry. So, the company is looking
for a better future. The products of the company are highly price sensitive
due to great fluctuations in the prices of raw materials and electricity
prices against the upward trend of costs, your company is not getting the
price to substantiate this increase in cost. However, your company is
striving for cutting in the costs wherever best can be possible.
RISKS AND CONCERNS:
The volatility in raw material, electricity and wages rates in the state as
well as in the country has a bearing on the profitability of the company.
Finished goods prices are not increasing in direct relation to the increase
in costs However, the company negotiates on red intervals with its
customers to increase prices of finished goods. Your company has made a
move through the chamber of commerce and industry to the central government
to reduce the customs duty on imported scraps and pig iron to overcome this
In compliance of recently introduced Section 217(2AA) in the Companies Act,
1956, your directors state that:
i. In the preparation of the annual account, the applicable accounts
standards had been followed along with proper explanation to material
ii. The Directors had selected such accounting policies and applied them
consistently and made judgments 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 financial year and of the profit of the company for
iii. The Directors had taken proper and sufficient care for the maintenance
of adequate accounting records 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; and
iv. That the Directors had prepared the annual accounts on a going concern
ADEQUACY OF INTERNAL CONTROLS:
Your company has installed adequate internal controls system in combination
with the delegation of powers The control systems are also supported by
internal audits and management reviews with documented policies and
The Company has complied with the requirements regarding Corporate
Governance as required under Clause 49 of the Listing Agreement entered
into with the Stock Exchanges, where the Company's shares are listed. A
report oil the Corporate Governance in this regard is made a part of this
Annual Report and a Certificate from the Company Secretary of the Company
regarding compliance of the conditions of the Corporate Governance is
attached to this report.
INDUSTRIAL RELATIONS AND PARTICULARS OF EMPLOYEES:
The Company continues to maintain good industrial relations with the
employees. The Board places on record its appreciation of their devotion to
the Company's objectives. None of the Company's employee comes under the
provisions of Section 217(2A) of the Companies Act read with the Companies
(Particulars of Employees) Rules 1975, as amended. The number of employees
as on 31.03.2006 were 98.
M/s. Ashwani Gupta and Associates, Chartered Accountants, Jalandhar will
hold office until the conclusion of 15th Annual General Meeting Being
eligible they offered themselves for reappointment. So, they are
recommended for reappointment from the conclusion of the 16th Annual
General Meeting to the 17th Annual General Meeting. The certificate with
regards to their appointment has been received so far and the appointment,
it made, would be within the limits prescribed under section 224(1B) of the
Companies Act, 1956.
The observation and suggestions pointed out by the auditors in their report
for this period are of routine nature the need no special explanation
DEMATERIALIZATION OF SECURITIES:
Securities & Exchange Board of India has directed that dematerialization of
the equity shares of your company is compulsory for listing of shares.
Therefore, your Company has already submitted an application to NSDL and
CDSL and is in process for executing necessary agreement and for has
appointed Registrar & Transfer Agent for dematerialization of its
Your Directors wish to record the shareholders, banks government
authorities and to the staff for the continued support and good will.
For & on behalf of the Board
Place: Jalandhar Rajinder Kapoor
Date : July 28, 2006. Mg. Director
ANNEXURE TO THE DIRECTOR'S REPORT
A. CONSERVATION OF ENERGY:
a. Energy Conservation measures taken:
Capacitor Bank has been installed to improve the power factor.
b. Additional investment and proposal, if any, being implemented for
reduction of consumption of energy:
No additional investment is proposed for time being.
c. Impact of measure at above (a) & (b) for reduction of energy consumption
and consequent impact on the cost of production of goods:
Energy consumption and the cost of production has been reduced.
d. Total energy consumption & energy consumption per unit of production:
As per Form-'A' attached.
B. TECHNOLOGY ABSORPTION:
a) Efforts made in technology absorption:
As per Form-`B' annexed.
C. FOREIGN EXCHANGE EARNING AND OUT GO:
a. Activities relating to exports, development of new export markets for
product and services, an export plans:
The Company has made export.
b. Total foreign exchange earned and used:
Current Year Previous Year
Earned$ 3054.20 0.00
Used 0.00 0.00
FORM-`A' (See Rule 2)
None for disclosure of particulars with respect to conservation of energy:
A. POWER AND FUEL CONSUMPTION:
Year Ended Year Ended
Units(Kwh) 2360240 3149261
Total Amount (Rs. Lakhs) 99.07 118.86
Rate/Unit (Rs.) 4.38 3.75
b. Owns Generation:
1. Through Diesel generator Units (Kwh) 27147 3230
Unit per liter of diesel oil 32.00 25.00
Cost/Unit (Rs.) 5.18 4.56
Through Steam Turbine generator Units 0.00 0.00
Unit per liter of fuel oil/gas 0.00 0.00
Cost/Unit (Rs.) 0.00 0.00
2. Coal (Specify quality and where used):
Quantity (tons) 0.00 0.00
Total Cost (Rs. Lakhs) 0.00 0.00
Average Rate 0.00 0.00
3. Furnace Oil:
Quantity (K. Liters) 120 114
Total Amount (Rs. Lakhs) 276 13.36
Average Rate 23 12.84
4. Other/Internal Generation:
(please give details)
Quantity 0.00 0.00
Total Cost (Rs. Lakhs) 0.00 0.00
Rate/Unit (Rs.) 0.00 0.00
B. CONSUMPTION PER UNIT OF PRODUCTION:
Particulars Unit Standard Year Ended Year Ended
(if any) 31.03.2006 31.03.2005
Raw Materials Ton. N.A. 1.002 1.002
Electricity Kwh. N.A. 2034.6897 2168.904
Furnace Oil Litre N.A. 95.28 78.729
Coal (Specify Kgs. N.A. 0.000 0.0050
Others N.A. N.A. 0.000 0.0000
(Form for disclosure of particulars with respect to technology absorption)
RESEARCH AND DEVELOPMENT:
1. Specific Areas in which R&D carried out by the Company:
2. Benefits derived as a result of above R&D:
3. Future Plans of action:
The company proposes to acquire metal refining technology based on computer
4. Expenditure on R&D:
a. Capital Rs. 0.00
b. Recurring Rs.45735.00
c. Total Rs.45735.00
d. Total R&D Expenditure as a total % of the Turnover % 0.07
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:
1. Efforts, in brief, made towards technology absorption, adaptation and
Only available technology is being used so far.
2. Benefits derived as a result of above efforts e.g. product improvement,
cost reduction and import substitution etc.:
3. In case of technology imported during the last years (reckoned from the
beginning of financial year), following information may be furnished:
a. Technology imported Not Applicable
b. Year of import Not Applicable
c. Has technology absorbed. Area where this Not Applicable
has taken place. Reasons therefore and future
plan of action.
Place: Jalandhar. For & on Behalf of Board
Date : 28.7.2006 Rajinder Kapoor, MD.