HIND DEVELOPMENT CORPN. LTD.
DIRECTORS' REPORT FOR THE YEAR ENDED 31ST MARCH, 1999.
The Directors present the Annual Report and Audited Accounts of the Company
for the year ended 31st March, 1999.
1. Your Directors do not recommend payment of any dividend for the year
ended 31st March, 1999.
An amount of Rs. 3 34 08 thousands has been transferred during the year to
Debenture Redemption Reserve Account in terms of the guidelines of the
Central Government for issue of debentures.
2. The Bamunari Plant of the ENGINEERING UNIT of the Company, which had
carried out an expansion by setting up a state of the art Automatic
Moulding Line, continued to export its products to USA, Japan and other
developed nations. The export of Steel Castings was higher during the year
as compared to the previous year. The Plant has now become an established
supplier in the global market and it is expected that exports will continue
to form a significant part of the Plant's turnover during the years to
come. The domestic demand was lower during the year due to reduced offtake
by the Indian Railways.
The Santragachi Plant received lower orders for wagons due to reduced
demand from the Indian Railways. The general recessionary trend effected
the freight movement of the Indian Railways and therefore the Railways
reduced their procurement of wagons. The effect of this was offset partly
by executing an order for Container Flat Wagons, which the company had
earlier received against the world bank aided contract from Container
Corporation of India Ltd.
The Tiljala Plant's production was about the same as last year and no
significant changes are expected during the coming year.
3. Due to labour unrest at Bharatpur Plant and difficult market conditions,
the Company's Engineering Division in Northern India, GENERAL ENGINEERING
WORKS, could not achieve its targeted production, turnover and
profitability. Although lockout at Bharatpur Plant was lifted on 28.9.98,
its normal level of production is expected to be achieved in the current
year. The production level at Faridabad Plant improved as compared to the
previous year, but normalcy could not be achieved due to poor availability
of quality raw material and difficult market conditions. Apart from these
the general economic recession in the country still continued which has
also affected the working at both the plants. However efforts are being
made towards improvement in working by effective cost control and optimum
utilisation of available resources.
4. PETROCARBON & CHEMICALS COMPANY, the Company's Chemical Division at
Haldia (West Bengal) was unable to maintain the sales an production of the
previous year due to difficulties faced by some of its major customers who
although, they had placed orders, did not uplift the material during the
year. The Unit was, however, able to reduce its cost substantially and
profitability was not much affected.
5. CYANIDES & CHEMICALS COMPANY, the Company's Chemical Division at Olpad,
Dist. Surat (Gujarat), did not perform satisfactorily primarily due to over
supply globally. Reduction in gold mining activities and incremental
production from new capacities in Korea and Australia resulted in excess
supply. There was fierce competition within manufacturers of Sodium Cyanide
and few of them resorted to large scale dumping. Imports in the country
therefore have drastically increased and price realisation rapidly
declined. Aggrieved from this, the company has filed petition for
introduction of anti-dumping duty on imports of Sodium Cyanide in the
country for redressal of the problem. Government of India, Ministry of
Commerce have initiated investigations in the matter.
6. INSULATORS & ELECTRICALS COMPANY, the Company's High Tension Insulators
Division at Mandideep (Madhya Pradesh), was able to increase its production
and turn over during the year. This was achieved despite the shortage of
power in the state and the poor financial liquidity of most of the electric
utilities in the country, which has further worsened during the year.
Certain grades of High Voltage Insulators, which the Unit was unable to
produce earlier, were manufactured during the year, which gave a better
realisation and provided a more complete range of products to its major
customers. Export orders received from U.K., South Africa, Gulf countries
and Germany were executed during the year. Domestic demand conditions were
stable during the year. The power sector is an important segment of the
infrastructure industry and is vital to the growth of the nation. However,
due to resource crunch and delayed implementation of major projects, it is
yet to take off but no national economy can expect to grow or prosper
without taking care of this important infrastructure industry and it is
expected that the future will see large investments in power generation and
transmission which will automatically result in increased demand of
7. DALHOUSIE JUTE COMPANY, the Company's Jute unit, achieved higher turn
over as compared to the previous year. Raw Jute prices witnessed some
increase during the year due to a smaller crop, but the overall
availability was comfortable.
8. MADHYA PRADESH IRON & STEEL COMPANY, the Company's Steel division at
Malanpur (Madhya Pradesh) could not make any headway due to continuous
recession in the steel industry. Power position also remained critical
throughout the year, which also aggravated the position. Apart from this
there was a a major fire in the electric sub-station of the plant. Orders
for some of the equipment lost in the fire have been place with the
suppliers and the balance minor items of short delivery are being placed.
Meanwhile vigorous efforts are being made for reduction in overhead
expenses in all possible manner.
9. 17 Deposits totalling Rs.70,500 due for payment on or before 31st March,
1999 were not claimed by the depositors on that date.
10. Statement giving particulars of employees pursuant to Section 217(2A)
of the Companies Act, 1956 read with the Rules thereunder and information
as per Companies (Disclosure of particulars in the Report of Board of
Directors) Rules, 1988, as amended, are annexed.
11. Sri H Jhunjhunwala, Managing Director, retired from the services of the
Company with effect from 1st October 1998. The Board places on record its
appreciation for the services rendered by him during his tenure.
12. Sri G.K. Bhagat and Sri V A Mody retire by rotation and being eligible
offer themselves for re-appointment.
13. The Auditors, M/s. Lodha & Company, Chartered Accountants, retire and
are eligible for re-appointment. You are requested to consider their re-
appointment and authorise the Board of Directors to fix their remuneration
for the current year. Notes referred to in the Auditors' Report are self
For and on behalf of the Board of Directors.
A K Gutgutia V A Mody
Date : 28th May, 1999.