1995 KUSUM AGROTECH LIMITED DIRECTOR'S REPORT Your Directors' have pleasure in presenting their Fourth Annual Report together with the Audited Accounts of the Company for the financial year ended 31st March, 1995. PERFORMANCE: Your Company started commercial production in its Solvent Extraction plant on 1st April, 1994 and in its refinery from 1st November, 1991. the overall availability of oilseeds during 1994-95 was low on account of cyclical and climatic conditions. Prices of oilseeds were also higher resulting higher cost of production. Your Company's performance during the very first year of its operations were also affected due to high raw material cost and adverse market conditions. In spite of adverse conditions in edible oil industry, your Company has resulted turnover of Rs. 2,781 Lacs and Net profit of Rs. 53 Lacs during the very first year of operation. Your Company's brand "KUSUM" for refined soya and Mustard oil have gained strong consumer support in all the markets of Rajasthan. The Company now proposes to introduce the brand in other parts of Northern and Eastern India. Your Company has marketed its products in bulk as well as in consumer packs, response of which have been excellent. The quality of the De oiled cake manufactured by your Company is one of the best available and well accepted by international market. Your Company has exported De oiled cake to Germany, Malaysia, Singapore and HongKong worth Rs. 712 Lacs during the year. FUTURE OUTLOOK: Your Company's performance in the current year is satisfactory. The turnover of the Company have increased to Rs. 1,786 lacs during the six months ended 30th September, 1995 as compared to Rs. 991 lacs during the corresponding period in the previous year. Future of the edible oil industry is also going to improve due to increased production of Soyabean seeds this season. The trade estimate of Soyabean seeds during the current season is 40 Lacs tonnes against 35 Lacs tonnes during last season. This will result in availability of oil seeds at cheaper prices. The Company plans to undertake value added projects in its existing line of business and is also diversifying into refined sunflower oil, which is expected to be commissioned by early 1996. AMALGAMATION: Your Company is going to be amalgamated with Kusum Products Ltd. with effect from 1st April, 1995, in pursuance of the approval of the members of the Company. The matter is pending before Hon'ble Calcutta High Court for their approval. DIRECTORS: Industrial Development Bank of India withdrew Sri S. P. Durve's nominations from the Board of Directors of your Company subsequent to his retirement from IDBI. Your Board would like to express its appreciation of the services rendered by Sri Durve as a member of the Board. Smt. S. B. Chitre has been nominated by IDBI as a member of the Report. Sri Pramod Dugar and Sri D. K. Chhajer retire by rotation and are eligible for re-appointment. AUDITORS: Your Company's Auditors M/s. R. Kothari & C,o., Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting and offered themselves for re-appointment. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO :- (A) CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION Your Company has already taken energy conservation measures wherever possible. However effort to conserve and optimise the use of energy through improved operational methods will continue. a) Fuel efficiency of the oil fired boiler has been periodically checked and necessary improvements made wherever required. b) Fuel gases have been monitored periodically to determine fuel efficiency of the boiler. c) D.G. Sets have been periodically serviced and fuel efficiency checked. d) Additional economiser has been provided in the Solvent Extraction Plant. The existing condensers and economisers were periodically serviced. FORM"A" A. Power & Fuel Consumption 1994-95 1. Electricity a. Purchased: Units 18,96,332 Total Amount 41,77,857 Rate/Unit 2.20 b. Own Generation: Through Diesel Generator (Unit) 82,920 Total Amount 2,37,151 Cost/Unit 2.86 2. Fuel Qty. Total Cost Average Cost Ltr. Rs. Rs. 1. L.D.O. 59390 3,75,345 6.32 2. L.S.H.S. 35685 2,13,396 5.98 3. R.F.O. 31411 1,72,760 5.50 4. F.O. 1257091 69,39,142 5.52 3. Others / Internal Generation -- Not Applicable (B) RESEARCH AND DEVELOPMENT: The Company has no specific Research and Development Department. However, the Company has fully equipped quality control department to check the quality of different products manufactured. (C) FOREIGN EXCHANGE EARNINGS AND OUTGO: (Rs. in Lacs) EARNING 498 OUTGO Nil PARTICULARS OF EMPLOYEES: There was no employee of the Company who received remuneration during the year under review in excess of the limit prescribed under Section 217(2A) of the Companies Act. 1956. ACKNOWLEDGEMENTS: Your Directors wish to place on record their appreciation of the continued support rendered by the shareholders, Consortium of Bankers, Financial Institutions and valuable contributions made by the employees at all levels. On Behalf of the Board P. DUGAR Chairman Place : Calcutta Dated : 10th November, 1995.