TELEMATICS SYSTEMS LIMITED
TO THE SHAREHOLDERS
Your Direclors have pleasure in presenting the Ninth Annual Report together
with the Audited Accounts of the Company for the year ended 31st March 1994.
i) Rural Automatic Exchanges (RAX) - 128 PORT
The procurement of this equipment which was decentralised during the previous
year was again centralised and with the introduction of the 256 Port RAX
syslem the demand for this product by DOT reduced substantially. As against a
sales of 263 units in the previous year only 27 units equivalent to 2700
lines could be sold during the current year.
ii) Rural Automatic Exchanqes (RAX) - 256 PORT
Although the Company had obtained the necessary approvals there was
subslanlial delay by DOT in releasing the orders and the quanlity was also
reduced. Because of various problems faced by the Company in arranging for
funds etc. only 2 nos. equivalent to 432 lines could be sold during the year.
iii) SBM - RAX SYSTEMS (MAX)
- The educational order received for 2 systems (equivalent to 2016 lines)
was executed after oblaining the various approvals. However further orders
for 6 syslems were received only in March 1994 based on the lender floaled in
July 1993. In view of the inordinale delay in finalising the lender
produclion and sales were restricled to the execution of educational order as
iv) Push Button Telephones
Delay in placement of orders and non availability of funds resulted in
reduced volume of around 6000 nos.
b) Operating Results
Substantial lower volumes combined with lower prices for almost all the
products resulted in a sleep all of gross realisation to nearly Rs. 333 lacs
compared to Rs. 1213 lacs achieved last year. This also resulted in the
Company incurring a cash loss of Rs. 311 lacs and a net loss of Rs. 366 lacs.
Non availabilily of funds continued to cripple operations. The cash credit
limits with Indian Bank were substantially overdrawn. IDBI also did not
disburse the balance amount of Rs. 31.60 lacs of loan sanctioned by them for
MAX project but adjusted it against a part of their overdues.
Your Directors have made every effort to cut overheads and keep expenditure
to the minimum.
During the year approval of prototypes for 256 Port and MAX systems were
obtained and orders were also received. Garmin International USA has
appointed the Company as their authorised agent in India to market the
product Global Posilioning System" used extensively in Defence. Although the
volumes will initially be small once the product is indigenised volumes may
pick up. Non availability of funds continued to affect plans for various
diversificalion schemes as well.
There has been no significant development in this sector during the year.
NEW TELECOM POLICY
The recently announced Telecom Policy appears to offer plenty of scope for
private parties to set up and operate exchanges in addition to offering other
value added services. However full details of the policy including salient
factors like tariff structure etc. are awaited.
OUTLOOK FOR THE CURRENT YEAR
The outlook for the current year does not give any room for oplimism. In
recent tender opened by DOT for supply of Telephones in which the Company
also participated the lowest bid was Rs. 411/-. This price will hardly give
any margin. A part from the orders received in March 1994 for supply of
SBMRAX systems for a gross value of Rs.300 lacs no other orders are expected
in the near future. With continuing funds constraints lack of regular orders
and the fact that the net worth has been eroded more than two ames there
hardly appears to be any ray of hope in the immediate future.
REFERENCE TO BIFR
As a resut of the amendment early this year to the Sick Industrial Companies
(Special Provisions) Act 1985 your Company
a. having been registered for not less than five years and
b. having suffered an erosion of its entire net worth s a "Sick Industrial
Your Directors have made the mandatory reference under Section 15of the said
Act to the Board for Industrial and Financial Reconstruction (BIFR) and their
advice is awaited.
R & D AND TECHNOLOGY ABSORPTION
Due to reduced prices for telephones the R & D leam is looking into ways and
means of culling the cost of production of telephone. As quality cannot be
sacrificed achieving cost reductbn may be a difficult process.
CONSERVATION OF ENERGY
Although our manufacture is not power intensive all possible steps are being
taken to conserve energy.
During the year Mr. T.S. Vijayaraghavan IAS took over from Mr. Shaktikanta
Das IAS and later
Mr. K.A. Malhew IAS look over from Mr. T.S. Vijayaraghavan IAS.
Also Mr. K. Appuswamy look over from Mr. R.T. Arasan and later Mr. Dipak Jain
IAS took over from
Mr. K. Appuswamy.
Mr. P.M. Thampi and Mr. S. Ghosh resigned during the year.
The Board wishes to record is appreciation of the valuable services rendered
by Mr.T.S. Vijayaraghavan IAS, Mr. Shaklikanla Das IAS Mr. P.M. Thampi Mr. S.
Ghosh Mr. K. Appuswamy and Mr. R.T Arasan.
Mr.K.A.Mathew IAS Mr.Dipah Jain IAS and Mr. A. Joseph Louis retire by
rotation at the forthcoming Annual General Meeting and being eligible offer
themselves for reappointment.
PARTICULARS OF EMPLOYEES
As the emoluments of the employees are below the prescribed level a slatement
of particulars of employees pursuant to the provisions of Seclion 217 (2A) of
the Companies Act 1956 is not applicable.
Your Directors take this opportunity to thanh the Govemment of India the
Government of Tamil Nadu Eleclronics Corporation of Tamil Nadu Limited
Industrial Development Bank of India Industrial Finance Corporatbn of India
Limited The Industrial Credit and Investment Corporation of India Limited
Indian Bank and The Hongkong and Shanghai Banking Corporation Limited for the
continuous support they have given to your Company.
Your Directors also wish to place on record the loyal and devoted service
rendered by all the Employee of your Company throughout the year.
FOR AND ON BEHALF OF THE BOARD
24th June 1994.