To the Members,
The Board of Director presents its 38th Annual Report of the Company together with itsAudited Accounts for the financial year ended 31st March 2013.
The financial results of the Company for the year ended March 31,2013 are summarised asfollows:
| || |
(Rs in Lakhs)
|PARTICULARS ||For the F.Y 2012-13 ||For the F.Y. 2011-12 |
|Gross Sales and Other Income ||5831.59 ||7400.07 |
|Profit/Loss(-) before Interest, Depreciation & Taxation ||(-)471.41 ||301.33 |
|Interest and financial charges ||493.16 ||339.29 |
|Profit/Loss(-) before depreciation ||(-)964.57 ||(-)37.96 |
|Depreciation ||180.71 ||110.32 |
|Profit /Loss (-) before tax ||(-)1145.28 ||(-)148.28 |
|Provision for Income Tax ||0.00 ||0.00 |
|Profit /Loss (-) after taxation ||(-)1145.28 ||(-)148.28 |
1. FINANCIAL AND OPERATIONAL REVIEW:
The performance of the Company during the year under review has been very weak andpoor, resulting in a loss of Rs1145.28 lakhs. The reasons of this deteriorations aremainly as below.
1) Demand slowdown remain continued through out the year under review from auto andpower sector.
2) After abnormal increase in natural gas (fossil fuels) price to the extent of almost300%, the company has to close its melting operations, based on gas, which has affectedabout 65% capacity of melting division.
3) High interest rate burden on credit facilities from Bank has very high finance cost,which had not been recovered in lower capacity utilisation.
4) CAPEX project over-run cost and immediate demand recession continuity has adverseimpact on the bottom line of the financial results.
5) Liquidity crunch due to continuous losses and repayment of term loan caused badly tothe working capital and ultimate very negative effect on the operations.
6) Employees cost could not be under control and overcome in the above all adversesituation through out the year.
There is a concerns relating to the company's ability to service huge debts and noclear signs of improvements in demand at the price which is cost recoverable. Whileinterest outgo is higher, the company is unable to generate enough earning to service thedebt and repayment obligations.
Your Directors have not recommended any dividend on equity shares for the year underreview on account of huge accumulated losses.
3. FIXED DEPOSITS:
The Company has not accepted any deposits so far within the meaning of Section 58A ofthe Companies Act, 1956 and hence the information in respect of matured and claimed butremaine'd unpaid deposits may please be treated as NIL.
4 LISTING WITH STOCK EXCHANGES:
The Shares of the Company are listed on the Bombay Stock Exchange Ltd (BSE) &Vadodara Stock Exchange
5. DIRECTORS :
Shri OP. Khetan and Shri Ashok Khetan shall retire by rotation as Directors pursuant tothe provision of Article 153 of the Articles of Association read with Section 255 of theCompanies Act, 1956, at this Annual General Meeting and eligible offer themselves forreappointment.
Your directors recommend that the resolution relating to re-appointment of Shri O. P.Khetan and Shri Ashok Khetan as Directors of the Company be passed.
M/s.B.A.Pavagadhi & Co., Chartered Accountants, Ahmedabad shall retire at theconclusion of this Annual General Meeting and have made necessary declaration regardingtheir eligibility pursuant to the provisions of section 224(1 B) of the Companies Act,1956. They are consequently eligible for re-appointment.
Members are requested to re-appoint the Auditors and authorize the Board of Directorsto fix their remuneration.
7. COMPANY SECRETARY:
In accordance with Section 383Aof the Companies Act, 1956 the Companies (ComplianceCertificate) Rules, 2001, the Company has obtained a certificate from a Company Secretaryin whole time practice confirming that the company has complied with all the provisions ofthe CompaniesAct, 1.956 and a copy of such certificate is kept on record.
8. COST AUDIT - COMPLIANCE REPORT:
As per Cost Audit Order by The Ministry of Corporate Affairs (MCA) it is mandatory toobtain cost audit compliance report. Accordingly, in terms of the above order and pursuantto the provision of section 233B of the Act, your directors have appointed Cost Auditor toissue Compliance Report. Such compliance report for FY 2012-13 is yet to be placed beforethe Board.
(a) Particulars of employees:
There is no employee covered under the provision of section 217(2A) of the CompaniesAct, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended andhence the information may be treated as NIL.
(b) Disclosure Pursuant to Section 217(1 )(e):
Due to increase in fossils fuel (natural gas) price the management is examining toswitch over to power saving induction furnaces.
(c) Safety, Pollution & Environmental Control:
The safety record of your Company remained satisfactory. The Company is making all outefforts to maintain the safety records and observing the norms for pollution andcontrolling environments as per the requirements of the Gujarat Pollution Control Board(GPCB).
(d) Conservation of Energy, Technology Absorption, Research & Development:
Particulars required to be disclosed under the Companies (Disclosure of particulars inthe Report of Board of Directors) Rules, 1988 are given in the Annexure to the report.
10. INDUSTRIAL RELATIONS:
Human resources are considered as the valuable assets of the organisation and is givenutmost importance, as a result of which, the co-operation and understanding between theworkmen and management is cordial. Your Directors wish to place on record the cooperationextended by the employees at all levels for achieving the objectives of your Company andexpect that such cordial relations will be maintained in future also.
11. DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, withrespect to Directors' Responsibility, it is hereby stated that:
(i) in the preparation of the accounts for the financial year ended 31st March 2013,the applicable Accounting Standards have been followed and that there are no materialdepartures from the same.
(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 ended31st March 2013 and of the profit and loss of the Company for the year under review.
(iii) the Directors have taken proper and sufficient care to the best of theirknowledge and ability for the maintenance of adequate accounting records for the yearended 31st March 2013 in accordance with the provisions of the Companies Act, 1956 forsafeguarding the assets of the Company and for prevention and detection of fraud and otherirregularities.
(Iv) the Directors have prepared the Annual Accounts of the Company for the financialyear ended 31s' March 2013 on a "going concern" basis.
Your Directors wish to place on record with its deep appreciation for the unstintedsupport and co-operation that the Company received from suppliers and other associatedwith the Company as its business partners. The Board of Directors would like to expresstheir grateful appreciation for the assistance and co-operation received from our Banker's- Bank of Baroda. .The Board wishes to place on record their deep sense of appreciationfor the commitment, continued support and co-operation of the employees of the Company.
The Directors also take this opportunity to express their sincere thanks to the Stateand Central Government Departments, Insurance Companies, Contractors, valued Customers,Suppliers for having actively lent their support to the Company from time to time. TheDirectors are also grateful to the shareholders of the Company for their confidence andfaith reposed by them in the Company. Your Director also wish to place on record theirdeep sense of appreciation for the committed services by the Executives, Staff and Workersof the Company.
On behalf of the Board
|Ankleshwar ||O. P. Khetan |
|10th July 2013 ||Managing Director |
ANNEXURE TO DIRECTORS' REPORT:
Conservation of energy, technology absorption and foreign exchange earnings and outgoas required under Companies (Disclosure of Particulars in the Report of Board ofDirectors) Rules, 1988 for the year ended 3151 March 2013.
(A) CONSERVATION OF ENERGY:
(a) Conservation Measures taken:
The Management took a decision to convert existing gas firing system into electricalinduction furnace to save energy cost.
(b) Efforts have been made to upgrade the Process Technology to import the rightphysical properties to the Company's products for the effective use and system changeshave been planned for future improvements.
Major investment is now required for this purpose to install induction furnace inmelting division.
(c) Impact of the above Measures:
Consequent to the steps taken as enumerated in Clause (a) above, energy cost as apercentage of total production will be maintained at the minimum level.
(d) Total energy consumption and energy consumption per unit of production: Form"A" enclosed.
(B) TECHNOLOGY ABSORPTION:
Form "B" enclosed.
(C) FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information on Foreign Exchange earnings and outgo is given below.
| ||2012-2013 ||2011-2012 |
|Foreign Exchange Earnings ||Rs 1,23,57,096 ||Rs 1,84,05,042 |
| ||(EUR0177932) ||(EURO 260667) |
|Foreign Exchange Outgo ||Rs 1,37,517 ||Rs 3,20,041 |
| ||(EUR01908) ||(EURO 4773) |
| ||On behalf of the Board |
|Ankleshwar ||O. P. Khetan |
|10th July 2013 ||Managing Director |
(See Rule "2")
Form of disclosure of particulars with respect to conservation of energy (To the extentapplicable)
|(A) Power & Fuel Consumption: ||Current Year ||Previous Year |
| ||31.03.2013 ||31.03.2012 |
|(1) Electricity: || || |
|(a) Purchased: || || |
|Purchased Unit ||8036514 ||9393303 |
|Total Amount ||57145672 ||60431747 |
|Rate/Unit (Approx.) ||7.11 ||6.43 |
|(b) Own Generation: || || |
|Wind Power Project: || || |
|Unit (KWH) ||1543919 ||1530764 |
|(2) Gas (CNG): || || |
|Unit (Sm3) ||2070315 ||1739018 |
|Total Amount ||62180103 ||39671928 |
|Rate/Unit (Approx.) ||30.03 ||22.81 |
|(3) Spheres/Fire Wood/Coke, etc: || || |
|Total Amount ||9290760 ||11239293 |
|(4) L.S.H.S/L.D.O: || || |
|Total Amount ||0 ||574312 |
|(B) Consumption per Unit of Production (M.T) Standard (if any) || || |
|Products-Iron Castings ||5629 ||8322 |
|(1) Electricity (in thousand units) ||1.43 ||1.13 |
|(2) Gas (in SM3Approx) ||367.79 ||208.97 |
(See Rule "2")
Form of disclosure of particulars with respect to Technology Absorption, Research &Development (R&D) Research & Development (R&D):
(1) Specific areas in which R&D carried out by the Company:
Company has been successful in developing in-house expertise to upgrade the existingrange of products.
(2) Benefits derived:
Cost reduction and achieved good yield with reduction in rejection percentage.
(3) Future Plan of action:
Maximum efforts are under way to consolidate the demand created on account ofupgradation and more improvement/contribution to the above direction.
|(4) Expenditure on R&D: ||Current Year ||Previous Year |
| ||31.03.2013 ||31.03.2012 |
|(a) Capital ||0 ||0 |
|(b) Recurring ||0 ||0 |
|(c) Total ||0 ||0 |
|(d) Total R&D Expenditure as a percentage of total turnover ||0 ||0 |
Technology Absorption, Adaptation and Innovation:
(1) Efforts Made: Improvement to get higher yield of castings out of available moltenmetal.
(2) Benefits derived: Product improvement and development with increase inproductivity:
(3) Particulars of technologies imported during the last five years : Not applicable