Your Directors are pleased to present the 30th Annual Report of the Company and theAudited Financial Statements for the year ended 31st March2014 and the AuditorsReport thereon.
| || ||FOR THE YEAR ENDED (Rs. in Lacs) |
|Sl. No. ||PARTICULARS ||2013-14 ||2012-13 |
|1. ||Income from operations ||936.76 ||7133.47 |
|2. ||Total Expenditure ||2861.05 ||6473.38 |
|3. ||Gross Profit before Int. Dep. and Tax ||(1924.29) ||660.09 |
|4. ||Interest & Financial Charges ||183.96 ||1071.88 |
|5. ||Depreciation ||358.13 ||350.77 |
|6. ||Operational Profit ||(2466.38) ||(762.56) |
|7. ||Prior Period Expenses || || |
|8. ||Extraordinary Income ||- ||1128.22 |
|9. ||Profit before Tax ||(2466.38) ||365.65 |
|10. ||Deferred Tax / Income Tax / Fri. Ben.Tax ||- ||(125.89) |
|11. ||Net Profit after Tax ||(2466.38) ||239.75 |
During the year ended 31st March 2014 the annual income of the Company was Rs.9.37crores as compared to Rs.71.19 crores in the previous year representing a decrease of86.91% which was due to the non performance of the company from July 2013 to 31stMarch2014. It resulted in a loss of Rs.24.66 crores
Status of the company:
In the year 2013-14 the company has suffered with severe decrease in demand in theautomotive sector and other market upheavals. Due to unprecedented slow down in theindustry high cost interest rates have worsened the over-all cost structure of thecompany there by reducing its margins paucity of working capital lead to in-operativecondition which resulted default with the secured lenders and subsequently went throughsecuritization Act initiated by M/s. Edelweiss Asset Reconstruction Company (EARC). Innutshell the company has suffered a great deal due to unavoidable circumstances thesituation has further worsened due to on-going recession the end of which is still not insight. In view of the above problems the projected earnings of the company has becomeinadequate to service the debt obligation at existing terms and conditions. Hence it isthe need of the company to re-structure the existing structure of borrowings which isunder progress.
But the company has got an overwhelming support from all customers the demand for yourcompanys products continuous to be encouraging as vendor codes are still alive andmanagement is putting its best of efforts to revive the companys out look fromthe existing conditions.
There is recession in the overall Indian Economy and more so in the Automobile Sector.Auto majors like M/s.Maruti and M/s. Tata Motors Ltd.have incurred losses due tocompetition with MNCs like Hyundai ToyotaHonda VolksWagon and Nissan Etc. The Auto mobilesector under going a transformation and trying to compete globally by reducing the overallcost of the production which in turn has impact on our industry. On the other hand theinput cost in the Indian Industry is gradually increasing due to increase in cost ofsteel fuel transport and salaries. In the situation the company would take a cautiousapproach and concentrate on managing the risk and containing the cost.
With a view to the present economic situation tight liquidity situation andCompanys current business plans the Directors feel it prudent not to recommend anydividend on Equity Shares
Income tax is not applicable for this year.
BOARD OF DIRECTORS
During the year there is no change in the Board of Directors of the Company and thefollowing are the Board of Directors of the Company.
|1. Mr.VilasVitthalValunj ||- Chairman & Managing Director |
|2. Mr.Abhay Kailas Patil ||- Whole time Director |
|3. Mr.Vikram Manubhai Desai ||- Director |
|4. Mr.Suhas Umakant Mate ||- Director |
|5. Mr.Prashant Kunjappa Nambiar ||- Independent Director |
|6. Mr.Santosh Bansilal Pandit ||- Independent Director |
|7. Mr.Jayaram Ramanandham ||- Independent Director (Nominee APIDC) |
In accordance with the provisions of Section 255 of the Companies Act 1956 read withArticles of Association of the Company Mr. Prashant Kunjappa Nambiar and Mr.SantoshBansilal Pandit Directors are liable to retire by rotation at the ensuing annual generalmeeting and being eligibleoffer themselves for re-appointment.
Pursuant to the requirement under section 217 (2AA) of the Companies Act 1956 withrespect to the Directors Responsibility statementit is hereby confirmed that:
(i) In the preparations of the Annual Accounts for the financial year ended 31st March2014 the applicable accounting standards have been followed along with proper explanationsrelating to material 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 atrue and fair view of the state of affairs of the Company at the end of the financialyear.
(iii) The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
(iv) That the Directors have prepared the annual accounts on a going concern basis.
The Company is committed to maintain the standards of Corporate Governance and adhereto the Corporate governance requirements set out by SEBI as required under Clause 49 ofthe Listing Agreements with the Stock Exchanges a Report on Corporate Governance withAuditors Certificate on compliance with conditions of Corporate Governance and aManagement Discussion & Analysis Report forms part of this Annual Report and isannexed hereto.
CODE OF CONDUCT
The Board has laid down a code of Conduct for all Board Members and Senior Managementof the Company.The Code of Conduct has been posted on the Companys website. BoardMembers and Senior Management personnel have affirmed compliance with the code for thefinancial year 2013-14. A separate declaration to this effect is made out in CorporateGovernance Report.
AUDITORS AND THEIR REPORT
The Statutory auditors of the Company M/s.Jawahar & Associates CharteredAccountants Hyderabad retire at the ensuing Annual General Meeting being offerthemselves for re-appointment as Statutory Auditor for the financial year 2014-15. Acertificate has also been furnished to the effect that their proposed re-appointment ifmade would be within the limit prescribed under section 224(1B) of the Companies Act2013 and that they are not disqualified for such re-appointment within the meaning ofsection 226 of the Companies Act2013.
With regard to the comments suggested by the Auditors of the Company regardingDebtors/Creditors confirmations are still pending and management is making an effort inobtaining the same. With regard to identification of slow moving/non moving items thecompany will crystallize the liability to bring the true and fair view of the financialsof the company. With regard to AS-15 provision for retirement benefits to employees dueto paucity of funds the company could not invest in gratuity funds and the same will bedone after the financial performance is improved. The stock of dies were taken at actualcost of valuation after due technical verification by the management.
The Company has not invited /accepted any fixed deposits from the public andconsequently no deposits has matured / become due for re-payment as on 31st March2014.
PERSONNEL AND PARTICULAR OF EMPLOYEES:
The relations with Employees continued to be cordial throughout the year. The Boardappreciates the willful co-operation and team spirits in the Management Cadre and otheremployees of the Company. In terms of provisions of Section 217 (2A) of the Companies Act1956 read with Companies (particulars of employees) Rules 1975 (as amended) there are noemployees governed by the said provisions.
The Industrial Relation has been fairly cordial during the year.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information on conservation of energy technology absorption foreign exchange earningsand outgo as required to be disclosed under the provisions of Section 217 (1) (e) of theCompanies Act1956 in Form A and forms part of this report. The additionalinformation required under Rules 1989 Form B is enclosed.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
Managements Discussion and Analysis Report for the year under review asstipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India ispresented in a separate section forming part of the Annual report.
During the year ended 31st March 2014 the annual income of the Company was Rs. 9.37crores as compared to Rs. 71.19 crores in the previous year representing a decrease of86.91% which was due to the non performance of the company from July 2013 to31-03-2014.It resulted in a Loss of Rs.24.66 Crores after allocations made underDepreciation Interest Charges and other provisions.
PENDING LITIGATION MATTERS
Following are the litigations pending against the Company for the various issues tillthe date of this notice and further the name of the opposite party along with the amountinvolved in respective case is mentioned below:
|Sl.No ||Name of the Opposite party ||Amount involved (Rs.in Lakhs) |
|1. ||Sales Tax Department ||25.75 |
TRADING AND DEMAT FACILITIES FOR SHARES
The shares of the Company are listed with and traded in dematerialized form at BombayStock Exchange. The listing fee is paid to the exchange for the year 2013-14.The ISINNo.of the company is INE 251F01010.Stock Code is 520003.
The Company is filing all Forms and Returns with the Registrar of Companies as requiredunder the Companies Act 1956 and has not defaulted in repayment of deposits payment ofdividend redemption of debentures and preference shares. Accordinglythe company has notcommitted any of the defaults specified under Section 274 (1) (g) of the Companies Act1956(as amended by the Companies Act 2000) disqualifying its Directors to act asDirectors of other Public Limited Companies.
Your Directors wish to place on record their appreciation of valuable co-operationextended to the Company by its bankers and various authorities of State and CentralGovernment Departments customers Vendors strategic investors and members. YourDirectors also takes this opportunity to place on record its appreciation of thecontributions made by the employees at all levels and last but not least of the continuedconfidence reposed by you in the Management.
|Date : 14th August 2014 ||For and on behalf of the Board |
|Place : Hyderabad. ||Sd/- |
| ||(VILAS V VALUNJ) |
| ||CHAIRMAN AND MANAGING DIRECTOR |
ANNEXURE TO DIRECTORS REPORT
Information as per section 217 (1) (e) of the Companies Act 1956 read with theCompanies (Disclosure of particulars in the Report of Board of Directors) Rules 1988 andforming part of the Directors Report.
A) CONSERVATION OF ENERGY
(i) Proper energy conservation measures has been taken up by the Company.
(ii) The Company has not made any additional investments and has not proposed anyamount for reduction of consumption of energy.
(iii) There is no impact of the measures at (i) and (ii) above for reduction of energyconsumption and consequent impact on the cost of production of goods.
(iv) Total energy consumption and energy consumption per unit of production:
(SEE RULE 2)
| ||2013-14 ||2012-13 |
|A) 1. POWER AND FUEL CONSUMPTION : || || |
|a) Purchased units (KwH in lacs) ||18.91 ||60.13 |
|Total amount (Rs. in lacs) ||129.87 ||372.57 |
|Rate per KwH (Rupees) ||6.87 ||6.20 |
|b) Own generation || || |
|Through Diesel Generator Units (KwH-Lacs) ||0.06 ||0.19 |
|Units/litres of Diesel in F.O (KwH) ||2.72 ||2.70 |
|Cost per Unit (Rupees) ||124.06 ||122.85 |
|Through steam turbine/generator Units ||- ||- |
|Units/litres of fuel/oil gas ||- ||- |
|Cost per Unit ||- ||- |
|2) COAL (SPECIFY QUANTITY A ND WHERE USED) || |
|Quantity (MTs. in lacs) ||- ||- |
|Total cost (Rs.in lacs) ||- ||- |
|Average Rate (Rupees) ||- ||- |
|3) Furnace Oil : || || |
|Quantity (Kilo ltrs.) ||104.00 ||488.940 |
|Total Cost (Rs.in lacs) ||45.63 ||209.42 |
|Average Rate (Rupees) ||43.88 ||42.83 |
|4) Other/Internal Generation || |
|NIL || || |
|B. Consumption per unit of Production || || |
|Production Steel forgings (MT) ||926.831 ||3305.734 |
|Electricity (Per MT of steel forging) ||14012.63 ||11270.58 |
|Furnace Oil (Kilo Liters) ||0.112 ||0.148 |
|Coal (Specify quantity P/T of Clinker) ||NIL ||NIL |
|Others (Specify) ||NIL ||NIL |
C) Technology Absorption:
Efforts made in technology: As per Form B of Annexure.
Research and development (R & D)
The major achievement by the Company due to their continuous Research and Developmentactivities is indigenization of tooling and improvements in the manufacturing process andoperational procedures.The Research and Development activity is given priority by theCompany.
Expenditure on R & D : As no significant amount has been spent the same is notshown separately.
TECHNOLOGY ABSORPTION ADAPTATION AND INNOVATION:
1. Efforts in brief made towards technology absorption adaptation and Innovation:Updation of Technology is a continuous process and adapted by innovation.
BENEFIT DERIVED AS A RESULT OF THE ABOVE R&D:
2. Benefit derived as a result of above efforts e.g. product improvement costreduction product development import substitution etc.: The Company has been able toefforts indigenize toolings to a large extent by virtue of Technology Absorptionadaptation and innovation.
3. In case of imported technology (imported during the last 5 years reckoned from thebeginning of the financial year) following information may be furnished: Not applicablesince 5 years period is over.
4. Periodical maintenance of Plant and Machinery is being done to ensure smooth runningof machinery and economy in power consumption. The total amount spent on Repairs andMaintenance is Rs. 4.51 lakhs.
5. The company has implemented ISO 2008 and TS 16949 Standards towards betterefficiency and taken measures for implementation of ISO 14001 towards environmentalimprovements.
|B) FOREIGN EXCHANGE EARNINGS AND OUTGO || |
|Foreign Exchange Inflow : ||NIL |
|Foreign Exchange Outflow: ||NIL |
| ||For and on behalf of the Board |
|Date : 14th August 2014 || |
|Place : Hyderabad. ||Sd/- |
| ||(VILAS V VALUNJ) |
| ||CHAIRMAN AND MANAGING DIRECTOR |