Your Directors present to you the Annual Report and Audited Statement of Accounts forthe year ended 31st March, 2013.
1. FINANCIAL RESULTS
( Rs. in crores)
| ||2012-13 ||2011-12 |
|Net Profit / (Loss ) for the year ||(21.95) ||(25.99) |
The year under review the polyester scenario continues to remain in pressure due toweak domestic textile market. This scenario has resulted into severe pressure on margins.The unprecedented increase in oil prices leading to abnormal hike in the prices of rawmaterial viz. PTA & MEG which are based on crude oil prices. The Polyester industry inIndia particularly has been suffering for incessant capacity additions in past few yearsin a market which was already over supplied. It has put pressure on the profitability ofyour company too during the year under review. During the year under review turnover ofyour Company is Rs. 385 crores as compared to the turnover of Rs. 545 crores in dieprevious year. Your company is able to reduce its net loss during the year under reviewdespite adverse market conditions and global recession. The net loss during the year underreview is Rs. 21.95 crores compared to the net loss of Rs. 25.99 crores in the previousyear Your Company is relentlessly putting all its efforts to reduce the cost and improvethe operating margins but the profit of the company is still negative. In view ofaccumulated losses, your directors are unable to declare any dividend for the year underreview.
The worldwide recessionary trend prevailing in the global synthetic textile marketadversely affected the exports of POY/PFY from the country. Despite of high volatility inthe international market spreading over the year under review, the Company has achievedexports of about Rs. 36 crores during the year under review compared to the exports of Rs.33 crores in the previous year. Your Company is making all the efforts to explore the newmarkets and improve its market position in the globe.
4. RESTRUCTURING OF DEBTS AND SANCTION OF REVIVAL SCHEME BY HON'BLE BIFR
The Company is making continuous efforts for restructuring / sanction of settlementwith remaining lenders. The Company has also filed a Draft Revival Scheme with the Hon'bleBIFR with copy to Operating Agency and all concerning parties pursuant to direction ofHon'ble BIFR on 11th December 2012, on the basis of audited accounts for the year ended31st March, 2012. The IFCI as operating Agency is now examining the scheme for circulationand necessary action to sanction the same.
5. PUBLIC FIXED DEPOSITS
In view of the petition filed by the Company, the Hon'ble Company Law Board had passedan order on 23.1.2002 that, "The repayment of Public fixed deposits shall be made bythe company in accordance with the "revival scheme" as and when approved by theBIFR under the provisions of "SICA". However payments on compassionate groundsare being made continuously by the Company as per the decision of the committee formed byHon'ble CLB for this purpose.
Shri H.L, Sharma is liable to retire by rotation and being eligible, offers himselffor. re-appointment. During the year under review Shri R. Raniwala and Shri S.N. Sharmahas resigned from the directorship of the company. Shri Niraj Rathore has been appointedas an Additional Director of the Company and the Board recommends his appointment asDirector liable to retire by rotation. BIFR has nominated to Shri P.P. Malhotra as specialDirector of the Company. He was appointed for a short period. The Board welcomes ShriNiraj Rathore and places on record its appreciation for the valuable contribution given byShri R. Raniwala, Shri P.P. Malhotra and Shri S.N. Sharma during their tenure as Directorsof the Company.
M/s. T.R. Chadha & Co., Chartered Accountants, Mumbai retire at the forthcomingAnnual General Meeting. Your Directors recommend their re-appointment as Auditors of theCompany for the year 2013-14. The observations made by the Auditors are self explanatoryand have been dealt within the notes forming part of financial statement and hence need nofurther clarifications.
8. INDUSTRIAL RELATIONS & PARTICULARS OF EMPLOYEES
Your Directors sincerely appreciate the workers, staff and officers for putting theirbest efforts. The Company has enjoyed healthy and cordial industrial relations throughoutthe year except the workers in the POY section created labor unrest and the company hasdeclared lock out in its POY Division from 15th November 2012. There is no employee,getting remuneration as prescribed under Section 217 (2A) of the Companies Act, 1956 readwith Companies (Particulars of Employees) Rules, 1975 as amended.
9. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956, the Board ofDirectors of the Company hereby state and confirm that:
(i) in the preparation of the annual accounts, the applicable accounting standards readwith notes on accounts have been followed along with proper explanation relating tomaterial departures;
(ii) the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit or loss of the Company of the year under review;
(iii) the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act, 195,6for safeguarding the assets of the Company and preventing and for detecting fraud andother irregularities;
(iv) the directors have prepared the annual accounts' on a going concern basis.
10. PARTICULARS OF ENERGY CONSERVATION. TECHNOLOGY ABSORPTION AND FOREIGN EXCHNAGEOUTGO
The statement of particulars relating to energy conservation, technology absorption andforeign exchange earnings and outgo as required in accordance with Section 217 (1) (e) ofthe Companies Act, 1956 read with Rule 2 (A), 2(B) and 2 (C) of the Companies (Disclosuresof particulars in the report of Board of Directors) Rules, 1988 is annexed hereto andforms part of this report.
11. CONSTITUTION OF AUDIT COMMITTEE
The Board of Directors have constituted the Audit Committee of Directors to exercisepowers and discharge functions as stipulated in section 292A of the Companies Act, 1956.The present Audit Committee consists of member directors as under:-
Shri H.L. Sharma (Chairman)
Shri R. Venugopal
Shri Niraj Rathore
Yours Directors would like to express their appreciation for the assistance andco-operation received from the Financial Institutions, Government authorities, employees,Customers and Shareholders during the year under review. Your Directors also appreciatethe dedication and efforts of executives, staff and workers of the Company.
ON BEHALF OF THE BOARD
|Place: Mumbai ||(KAMAL RANKA) |
|Date: 27th June, 2013 ||Chairman & Managing Director |
ANNEXURE TO THE DIRECTORS' REPORT
Information as per Section 217(l)(e) read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules, 1988.
1. ENERGY CONSERVATION :
The Company has been giving high priority to conservation of energy on continuous basisby close monitoring of energy consuming equipments. The energy conservation measures takenby the Company include installation of energy efficient equipments and energy savingdevices, implementation of various measures arising out of an energy audit and reductionof motor-ratings wherever possible. Periodical reviews and studies are undertaken fromtime to time for energy savings.
| ||Current Year ||Previous Year |
|A. Power. & Fuel Consumption : || || |
|1. Electricity : ||- ||- |
|a. Purchased (Units in lacs) ||350.26 ||475.00 |
|Total Amount ( Rs. in lacs) ||1862.62 ||2508.22 |
|Rate/Unit (Rs.) ||5.32 ||5.28 |
|b. Own Generation rThrough Diesel Generation || || |
|i) Unit in lacs ||1.08 ||5.13 |
|if) Units /Kgs of LDO & FO ||3.56 ||3.71 |
|m) Cost Per Unit (Rs.) ||14.62 ||16.98 |
|2. Furnace Oil / Diesel Oil || || |
|Quantity MT ||2519.64 ||5873.52 |
|Total Cost ( Rs. in lacs) ||1045.12 ||2067.67 |
|Average Rate Per Kgs (Rs.) ||41.48 ||35.20 |
|3. Briquettes || || |
|Quantity (MT) ||5958.88 ||- |
|Total Cost ( Rs. in lacs) ||327.44 ||- |
|Average Rate Per Kgs (Rs.) ||5.50 ||- |
|4. Consumption per unit of Production : || || |
|Production ||Chips/PQY/PFY ||Chips/POY/PFY |
|Unit ||Kg. ||Kg. |
|Electricity ||0.90 ||0.89 |
|Furnace Oil/Diesel Oil/Briquettes ||0.22* ||0.11 |
|* Due to Furnace Oil replaced bv BriQuettes || || |
2. TECHNOLOGY ABSORPTION :
Your Company is having research and development cell, headed by a senior andexperienced textile technologist. The section is keeping continuous watch on the qualityof the product at various stages. The R & D section also keeps a regular track on thelatest advancement on the spinning and finishing technology in order to keep pace with thedemand of the new products.
3. FOREIGN EXCHANGE EARNING AND OUTGO :
The Company has earned foreign exchange of Rs. 3629.59 lacs against an outgoof Rs.682.32 lacs during the year.