| The Members,
The Directors have pleasure in presenting the 21st Annual Report of
the Company together with the Audited accounts for the year ended 31st
March 2014.
FINANCIAL REVIEW:
(Rupees in Lacs)
Particulars 2013-14 2012-13
Total Turnover (Net) 12648.3 11244.87
Profit Before Depreciation, Interest and Tax 668.17 753.65
Depreciation 125.58 122.93
Interest 535.49 622.12
Profit Before Current Tax 7.09 8.6
Profit after Current Tax 4.9 5.94
Balance Profit B/f from earlier year 2689.13 2743.19
Appropriation 2694.03 2749.13
Transfer to General Reserve 60 60
Proposed Dividend (including Dividend Tax) , 0 0
Profit C/f to Balance Sheet 2634.03 2689.13
RESERVES:
Your Board has approved the transfer of Rs. 60.00 Lakhs to the General
Reserves.
DIVIDEND :
The Board of Directors of the Company has not recommended any Dividend
during the Year.
MANAGEMENT DISCUSSION AND ANALYSIS FINANCIAL PERFORMANCE
AML Steel Limited (AML's) Net Turnover for the financial year ended
March 31, 2014 increased to Rs. 126.48 crores from Rs. 112.45 crores in
the previous year. The operating profit (PBDIT) of the Company has
decreased to Rs. 6.68 crore from Rs. 7.54 crores in the previous year.
Net Profit before tax has however has decreased to Rs. 7.09 lakhs from
Rs. 8.601akhs in the previous year. The Profit of your Company for the
Year 2013 -14 was affected adversely mainly due to the impact of input
prices and higher overheads.
INDUSTRY STRUCTURE AND DEVELOPMENTS
The demand for steel in India is expected to rise 7 per cent in next
financial year beginning April 1 as compared to sluggish projected
growth of 5.5 per cent in 2013-14. The overall outlook for the steel
sector is positive and the demand was likely to pick up in next
financial year on the back of revival in the economic growth and the
government's measures to ease infrastructure Investment Rules.
OPPORTUNITIES
The global steel industry has witnessed reasonable demand growth and
steel manufacturing gradually shifted to emerging market such as China
and India. By utilizing the optimum resources along with the
liberalized Foreign Direct Investment policies can further help to grow
the Steel Industries in India.
CHALLENGES
The adverse cost fluctuations in input raw material and its
availability & costs, high interest, taxes, duties, inadequacy of funds
to the expansion or modification of project Low labour productivity,
fluctuations in environment, technology up gradation etc impede the
development of Steel Industries in General. One of the major specific
threats includes building the capability of the existing work force to
meet the higher level of skill requirements, to develop the
infrastructure.
OUTLOOK
During the year Our Country improved its position to 04th in the said
sector. Your Company always intends to actively pursue these growth
opportunities in the fast growing Iron and Steel manufacturing sector
in the country. It will focus on the optimum utilization of available
resources by creating a balance economy, maximum returns to the
members, reaching a good impact on public by adhering to high ethics
and standards.
COMPANY'S PRODUCTION MILD STEEL INGOTS & TMT BARS:
During the year under consideration your company achieved a turnover of
Rs. 126.48 Crores. Your Company is presently using its furnace to
convert Scrap into M.S Ingots for its captive manufacturing thus
reducing cost of production. Demand for TMT Bar is expected to rise as
a result of various initiatives taken by government of India to boost
infrastructural Industry.
RISKS AND CONCERNS
Risk and concerns given by the management are not in detail but only
highlighting some of salient among them. It includes fluctuation in
input prices, nonavailability of adequate financing, Frequent changes
in technology, price volatility, Climate Changes, Strict regulatory
frame works etc. Managing Director, Directors, Business, Plant heads
and executives in charge manage risk on a daily basis through cross
functional involvement and intense communication across business.
ADEQUACY OF INTERNAL CONTROL
The company has an internal audit system for assessing suitability of
the internal controls, adherences to policies, procedures and taking
corrective action to address any gaps. It facilitates proper
recommendation for improving the business systems. These controls have
been designed to provide a reasonable assurance with regard to
maintaining proper accounting controls, monitoring operations,
protecting assets from unauthorized use or losses, compliances with
regulations and for ensuring reliability with financial reporting. The
company has continued with its efforts to align processes and controls
with best global practices in these areas as well.
The Audit Committee of the board actively reviews the adequacy and
effectiveness of internal control systems and suggests improvements to
strengthen the same.
SUBSIDIARIES:
A brief description of AML Steel Subsidiaries is as follows:
Name Products Location
Ankit Ispat Private Limited MSI (Mild Steel Ingot) Kariakal
Ashok Steel Industries MSI (Mild Steel Ingot) & Sri Lanka
Private ltd TMT Bars
AML Steel & Power Limited Sponge Iron, Power Plant Jharkhand
for captive consumption &
Steel Melting Shop for
manufacturing of Billets
As required under Section 217 of the Companies Act, 1956, the Audited
Statement of accounts along with the report of the Board of Directors
and Auditors' Report of your Companies, subsidiaries, namely, AML Steel
& Power Limited, Ankit Ispat Private Limited and Ashok Steel Industries
(P) Limited, Srilanka, are annexed to this report.
PUBIC DEPOSITS:
The Company has not accepted or not renewed any Public Deposits, as
defined under section 58A of the companies Act,1956 during the year
under review.
HUMAN RESOURCES:
The Industrial Relation with the employees of the Company continues to
be cordial. Your Company takes all the necessary steps to facilitate a
friendly atmosphere with in the organization by way of hiring,
developing and retaining the best personnel.
DIRECTORS:
Shri Ankit Agarwal and Shri Vinay Kishore Kasat, Directors of the
Company are due for retirement by rotation at this annual General
Meeting who are eligible for re - appointment. Brief particulars of
these Directors are given below:
i) Ankit Agarwal- is a Promoter cum Non-Executive Director of the
Company. He is an engineering graduate from Anna University, Chennai.
And He is a member of the management team responsible for the company's
day to day operations and long term.
ii) Vinay Kishore Kasat - is a Non-Executive Independent Director of
the Company. He is a graduate in commerce and having an experience in
different industries. He is practicing as an industrial consultant from
the year 1998. He is also involved in the social activities.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 217(2 A A) of the Companies
Act, 1956, with respect to Directors' Responsibility Statement, it is
hereby confirmed that:
(i) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(ii) The directors have selected such accounting policies and applied
them consistently and made judgments and estimates that were reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year ended March 31 , 2014
and the profit of the company for that year;
(iii) The directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the company and for preventing and detecting fraud and other
irregularities, if any;
(iv) The accounts have been prepared on a going concern basis.
CONSOLIDATED FINANCIAL STATEMENTS:
In terms of listing agreement with the Stock Exchanges, the duly
audited consolidated financial statements are placed as Annexure. These
statements have been prepared on the basis of audited financial
statements received from subsidiary companies as approved by their
respective Boards.
PARTICULARS OF EMPLOYEES:
There were no employees of the company who were in the receipt of the
remuneration as per the limits prescribed by Section 217(2A) of the
Companies Act, 1956 and the rules framed there under.
DISCLOSURE OF PARTICULARS:
The information required under Section 217(l)Ie) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988 is given as annexure forming part of
this Report.
LISTING:
Your Company's shares have been listed at Madras Stock Exchange
Limited, Delhi Stock Exchange Association Limited and Ahmedabad Stock
Exchange Limited. It is confirmed that the Annual Listing fees upto the
period from
01.04.2014 to 31.03.2015 has been paid to the aforesaid exchanges.
AUDITORS:
M/s. K.P. Jain & Co., Chartered Accountants, Chennai, the Auditors' of
the Company retire at the conclusion of the Annual General Meeting and
being eligible, offer themselves for re-appointment.
CORPORATE GOVERNANCE
In terms of listing agreement with the Stock Exchanges, a compliance
report on Corporate Governance is given as Annexure. A certificate from
Auditors of the company regarding compliance of conditions of Corporate
Governance is placed as Annexure. The Board has laid down a Code of
Conduct for all Board Members and Senior Management of the company.
VIGIL MECHANISM:
In pursuant to the provisions of section 177(9) & (10) of the Companies
Act, 2013, a vigil mechanism for directors and employees to report
genuine concerns has been established.
CAUTIONERY STATEMENT
The statement in this management Discussion and analysis report
describing the company's projections, estimates, expectations or
predictions may be 'forward-looking statement' within the meaning of
applicable securities laws and regulations. These statements being
based on certain assumptions and expectations of future events, actual
results could differ materially from those expressed or implied.
APPRECIATION:
Your Directors would like to place on record our sincere appreciation
and thank the entire team of AML Steel limited for their support
inspite of challenging business environment. We take this opportunity
to express our sincere thanks to all stake holders for their confidence
and faith and to all Government, Regulatory Authorities and Banks for
their valuable support.
For and on behalf of the Board
Place : Chennai Ankit Agarwal Ajay Agarwal
Date : 04.09.2014 Director Director
(DIN: 00065020) (DIN: 00064366) |