| Dear Members,
The Directors take pleasure in presenting the Twenty Ninth Annual
Report together with the audited financial statements for the year
ended 31st March, 2015. The Management Discussion and Analysis has also
been incorporated into this report.
1. FINANCIAL RESULTS
(Rs. In Lacs)
2014-15 2013-14
Income from Operation 5413.31 4648.42
Less : Manufacturing,
Administrative & Selling
Expenses 4972.21 4223.11
Profit before Depreciation
& Interest 441.10 425.31
Less : Interest 181.71 138.31
Depreciation 182.39 137.54
Provision for Taxation
(Net Deferred Tax) 23.82 46.17
Profit after Taxation 53.18 103.29
Add : Surplus Brought
Forward From Previous Year 10.04 6.75
Less : Transfer to General
Reserves & others 44.39 100.00
Balance carried forward
to Balance Sheet 18.83 10.04
The Company proposes to transfer an amount of Rs.40 lacs to the General
Reserves. An amount of Rs.18.83 lacs is proposed to be retained in the
Statement of Profit and Loss.
2. HIGHLIGHTS OF PERFORMANCE
* Total income for the year was Rs.53.18 lacs as compared to Rs.103.29
lacs in 2014
* Total net sales for the year was Rs.5399.26 lacs as compared to
Rs.4640.70 in 2014, a growth of 16.35%
* Total profit before Interest & Depreciation for the year was Rs441.10
lacs as compared to Rs. 425.31 lacs in 2014
3. BUSINESS OPERATIONS
(a) During the Financial Year ending 31st March 2015, your company has
installed Rapid Jet Dyeing Machines & Thermopack & Latest Technology
Supporting Machines adding to the existing Plant & Machinery. In export
front company establishing & exploring new markets suitable to the
product variety of the company.
4. DIVIDEND
Your Directors do not recommend any Dividend for the year under review,
so as to conserve the resources of the Company.
5. SHARE CAPITAL
The paid up Equity Share Capital as on 31st March, 2015 was Rs
4,21,09,500. During the year under review, the Company has not issued
shares with differential voting rights nor granted stock options nor
sweat equity. As on 31st March, 2015, the Directors of the Company hold
the equity shares of the Company as follows:
Name of the Director Number of % of Total
Shares Capital
Mr. Kailash S. Khator 2,36,975 5.58
Mr. Arvind S. Khator 31,750 0.75
Mr. Ashok S. Khator 99,850 2.35
Mr. Mukesh Khandelwal Nil Nil
Mr. Jogendra B. Chodhary Nil Nil
Mr. Dev Kumar P Lohar Nil Nil
6. FINANCE
Cash and cash equivalent as at 31st March, 2015 was Rs.401025.25. The
Company continues to focus on judicious management of its working
capital. Receivables, inventories and other working capital parameters
were kept under strict check through continuous monitoring.
6.1 DEPOSITS
The Company has not accepted deposit from the public and shareholders
falling within the ambit of Section 73 of the Companies Act, 2013 and
the Companies (Acceptance of Deposits) Rules, 2014.
6.2 PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to the Financial Statements.
7. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The criteria prescribed for the applicability of Corporate Social
Responsibility under Section 135 of the Companies Act, 2013 is not
applicable to the Company.
8. BUSINESS RISK MANAGEMENT
The nature of business is manufacturing in Textiles. The inheritant
risk to the business of the company is as follows:
a) Foreign Exchange Risk
b) Yarn Price Risk
c) Stiff Global Competition
d) Government Policy on incentives for exports
e) Risk elements in business transactions
f) Success of Cotton Crop
The nature of risk is dynamic of business and entrepreneurship. The
Company has not formed Risk Management Committee and considered it as
optional item as prescribed under Clause 49 of Listing Agreement.
9. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. The scope and authority of the
Internal Audit (IA) function is defined in the Internal Audit Charter.
To maintain its objectivity and independence, the Internal Audit
function reports to the Chairman of the Audit Committee of the Board.
The Company monitors and evaluates the efficacy and adequacy of
internal control system in the Company, its compliance with operating
systems, accounting procedures and policies at all locations of the
Company. Based on the report of internal audit function, process owners
undertake corrective action in their respective areas and thereby
strengthen the controls. Significant audit observations and corrective
actions thereon are presented to the Audit Committee of the Board.
10. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a vigil mechanism to deal with instance of fraud and
mismanagement, if any. The detail of the Whistle Blower Policy is
explained in the Corporate Governance Report.
11. SUBSIDIARY COMPANIES
The Company has no Subsidiary Company.
12. DIRECTORS
In terms of the Articles of Association of the Company, Mr. Kailash
Khator, Director, retires by rotation at the ensuing Annual General
Meeting and being eligible, offers himself for re-appointment.
The present tenure of Mr. Kailash S Khator as a Managing Director was
expired on 31st March, 2015. The Nomination and Remuneration Committee
has recommended the appointment of Mr. Kailash S Khator as a Managing
Director. The Board of Directors has decided to re-appoint him as a
Managing Director for period of 5 years w.e.f. 1st April, 2015 and the
item no. 4 of notice is for the same.
The present tenure of Mr. Arvind S Khator as Whole- Time Director was
expired on 31st March, 2015. The Nomination and Remuneration Committee
has recommended the appointment of Mr. Arvind S Khator as Whole-Time
Director. The Board of Directors has decided to re-appoint him as
Whole-Time Director for period of 5 years w.e.f. 1st April, 2015 and
the item no. 5 of notice is for the same.
The present tenure of Mr. Ashok S Khator as Whole- Time Director was
expired on 31st March, 2015. The Nomination and Remuneration Committee
has recommended the appointment of Mr. Ashok S Khator as Whole-Time
Director designated as Chief Financial Officer (CFO). The Board of
Directors has decided to re-appoint him as Whole-Time Director
designated as Chief Financial Officer (CFO) for period of 5 years
w.e.f. 1st April, 2015 and the item no. 6 of notice is for the same.
12.1 Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has carried out an annual performance
evaluation of its own performance, the directors individually as well
as the evaluation of the working of its Audit, Nomination &
Remuneration and Stakeholders' Relationship Committees. The manner in
which the evaluation has been carried out has been explained in the
Corporate Governance Report.
12.2 Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection and appointment of Directors,
Senior Management and their remuneration. The Remuneration Policy is
stated in the Corporate Governance Report.
12.3 Meetings
A calendar of Meetings is prepared and circulated in advance to the
Directors.
During the year four Board Meetings and four Audit Committee Meetings
were convened and held. The details of which are given in the Corporate
Governance Report. The intervening gap between the Meetings was within
the period prescribed under the Companies Act, 2013.
13. DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the
information and explanations obtained by them, your Directors make the
following statements in terms of Section 134(3)(c) of the Companies
Act, 2013:
a) that in the preparation of the annual financial statements for the
year ended 31st March, 2015, the applicable accounting standards have
been followed along with proper explanation relating to material
departures, if any;
b) that such accounting policies as mentioned in Note 1 of the Notes to
the Financial Statements have been selected and applied consistently
and judgement and estimates have been made that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at 31st March, 2015 and of the profit of the Company for
the year ended on that date;
c) that proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
d) that the annual financial statements have been prepared on a going
concern basis;
e) that proper internal financial controls were in place and that the
financial controls were adequate and were operating effectively.
f) that systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
14. RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the
financial year were on an arm's length basis and were in the ordinary
course of business. There are no materially significant related party
transactions made by the Company with Promoters, Directors, Key
Managerial Personnel or other designated persons which may have a
potential conflict with the interest of the Company at large.
All Related Party Transactions are placed before the Audit Committee as
also the Board for approval. Prior omnibus approval of the Audit
Committee is obtained on a quarterly basis for the transactions which
are of a foreseen and repetitive nature. The transactions entered into
pursuant to the omnibus approval so granted are audited and a statement
giving details of all related party transactions is placed before the
Audit Committee and the Board of Directors for their approval on a
quarterly basis.
None of the Directors has any pecuniary relationships or transactions
vis-a-vis the Company.
15. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and
its future operations.
16. AUDITORS
16.1 Statutory Auditors
The Company's Auditors, M/s. S. R. Goyal & Co., Chartered Accountants,
Mumbai who retire at the ensuing Annual General Meeting of the Company
are eligible for reappointment. They have confirmed their eligibility
under Section 141 of the Companies Act, 2013 and the Rules framed
thereunder for reappointment as Auditors of the Company. As required
under Clause 49 of the Listing Agreement, the auditors have also
confirmed that they hold a valid certificate issued by the Peer Review
Board of the Institute of Chartered Accountants of India.
Members' attention is invited to the observation made by the Auditors
under "Emphasis of Matter" appearing in the Auditors Reports.
16.2 Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and The Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 201 4, the Company has appointed M/s P. P. Shah &
Co., Practicing Company Secretary to undertake the Secretarial Audit of
the Company. The Report of the Secretarial Audit Report is annexed
herewith as "Annexure A".
17. ENHANCING SHAREHOLDERS VALUE
Your Company believes that its Members are among its most important
stakeholders. Accordingly, your Company's operations are committed to
the pursuit of achieving high levels of operating performance and cost
competitiveness, consolidating and building for growth, enhancing the
productive asset and resource base and nurturing overall corporate
reputation. Your Company is also committed to creating value for its
other stakeholders by ensuring that its corporate actions positively
impact the socio- economic and environmental dimensions and contribute
to sustainable growth and development.
18. CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate section on corporate governance practices followed by the
Company, together with a certificate from the Company's Auditors
confirming compliance forms an integral part of this Report.
19. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and
foreign exchange earnings and outgo stipulated under Section 134(3)(m)
of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts)
Rules, 2014, is annexed herewith as "Annexure B".
20. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form
MGT-9 is annexed herewith as "Annexure C".
21. PARTICULARS OF EMPLOYEES
There is no employee in the Company drawing monthly remuneration of
Rs.5,00,000/- per month or Rs.60,00,000/- per annum. Hence the Company
is not required to disclose any information as per Rule, 5(2) of The
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014.
22. ACKNOWLEDGEMENTS
Your Directors thank the various Central and State Government
Departments, Organizations and Agencies for the continued help and
co-operation extended by them. The Directors also gratefully
acknowledge all stakeholders of the Company viz. customers, members,
dealers, vendors, banks and other business partners for the excellent
support received from them during the year. The Directors place on
record their sincere appreciation to all employees of the Company for
their unstinted commitment and continued contribution to the Company.
23. CAUTIONARY STATEMENT
Statements in the Board's Report and the Management Discussion &
Analysis describing the Company's objectives, expectations or forecasts
may be forward-looking within the meaning of applicable securities laws
and regulations. Actual results may differ materially from those
expressed in the statement. Important factors that could influence the
Company's operations include global and domestic demand and supply
conditions affecting selling prices of finished goods, input
availability and prices, changes in government regulations, tax laws,
economic developments within the country and other factors such as
litigation and industrial relations.
By Order of the Board of Directors
Sd/- Sd/-
Arvind Khator Kailash Khator
Whole Time Director Managing Director
Place: Mumbai
Dated: 30th May, 2015
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