| Dear Members,
The Directors are pleased to present herewith the twenty-ninth Annual
Report together with the audited statement of accounts of your Company
for the year ended 31st March, 2015.
FINANCIAL RESULTS
Year ended Year ended
31.03.2015 31.03.2014
Rs. in lacs Rs. in lacs
Turnover 7,339.10 6,533.85
Other Income 84.23 60.50
Income from Operation / Profit
before Interest and Depreciation 282.37 201.15
Interest 130.74 56.58
Profit before Depreciation 151.63 144.57
Depreciation 30.41 38.60
Profit Before Tax 121.22 105.97
Deferred Tax (43.20) (92.82)
Profit After Tax and before
exceptional items 78.03 13.15
Exceptional Items (1.18) (29.82)
Profit / Loss for the year 76.85 (16.67)
In order to meet the growing funding requirements of the Company it has
been decided to retain profits of the business in the Company, as such
your directors have not recommended any dividend for the year under
report.
WORKING
The production improved during the year by 9% and was higher at 4362
M.T. as against 4014 M.T. last year. The turnover was higher by 12.32%
at Rs. 7339.10 lacs as against Rs. 6533.85 lacs. This is due to the
rise in exports which constitute 54 % of total sales made during the
year and exports are made on CIF basis sans duties and taxes. The
company has also continued to manufacture nylon yarns under its
agreement for processing speciality yarns. The processing charges
increased by 21% from Rs 79 lacs last year to Rs. 95.31 lacs. The
Company has modified some of its machinery and enhanced its capacity to
facilitate manufacture of newer products. The export turnover was
higher at Rs. 3958.52 lacs as against Rs. 3911.11 lacs last year.
The profits before taxation increased to Rs. 121.22 lacs as against Rs
105.97 lacs in the past year. The Company had upgraded many of its
production facilities, improved capacity utilization and used better
marketing strategies which improved the overall performance of the
Company during the year. The management is working hard to improve the
capacity utilization further. The draw warping and sizing activity
remained on a low key as the margins remained under pressure due to
lack of demand in the segment in the domestic market. The prices
remained volatile during the year due to the fluctuation in the crude
oil prices. The Company is expecting to augment its capacity to balance
its existing capacity and meet, domestic as well as the exports market
requirement.
EXPORTS
The company continued exports of its products and it has exported about
54 % of the total sales during the year. The Company expects to explore
other global markets owing to positive response from international
customers. The products are well received by the market.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
No company has become/ceased to be a joint venture partner or associate
of the Company during the financial year 2014-15.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure
I to this Report.
Mr. S. K. Mishra, Director of the Company retires by rotation and being
eligible offers himself for reappointment at this Annual General
Meeting. The Board of Directors has recommended his reappointment for
consideration of the shareholders.
Mrs. Meeta Shingala was appointed as an Additional Director of the
Company on 10th February, 2015 and holds office upto the date of the
ensuing Annual General Meeting. Her appointment as an Independent
Director is proposed for a term of 5 years. The Company has received a
Notice as per the Provisions of the Section 160(1) of the Companies
Act, 2013, from a member of the Company sponsoring her candidature as a
Director of the Company. The Board of Directors recommends her
appointment.
All independent directors have given declarations that they meet the
criteria of independence as laid down under section 149(6) of the
Companies Act, 2013 and clause 49 of the Listing Agreement.
KEY MANAGERIAL PERSON
During the year under review, the company has appointed Ms. Vaishali
Naik as Company Secretary of the company.
BOARD EVALUATION
In compliance with the provisions of the Companies Act, 2013 and Clause
49 of the Listing Agreement, the performance evaluation of the Board
was carried out during the year under review. The Board of Directors
expressed their satisfaction with the evaluation process.
MEETINGS
During the year four Board Meetings, four Audit Committee Meetings, One
Stakeholders Relationship Committee Meeting, One Nomination and
Remuneration Committee Meeting and One Independent Directors Meeting
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.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The company has not given any loans or guarantees covered under the
provisions of section 186 of the Companies Act, 2013.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
Pursuant to Section 177 of the Companies Act, 2013 and Clause 49 of the
Listing Agreement with the Stock Exchanges the company has established
a vigil mechanism which may be called "Whistle Blower Policy" for
employees and Directors to report to the management instances of
unethical behaviour, actual or suspected fraud or violation of the
Company's code of conduct. More details on the same are given in the
Corporate Governance Report.
REMUNERATION POLICY
The company follows a policy on remuneration of Directors and Senior
Management employees. The Policy is approved by the Nomination &
Remuneration Committee and the Board. The Remuneration Policy is stated
in the Corporate Governance Report.
FIXED DEPOSITS
The outstanding amount of Deposits with your Company was Nil. During
the year your Company has not accepted any deposits within the meaning
of Section 73 of the Companies Act, 2013 and the Companies (Acceptance
of Deposits) Rules, 2014.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company
during the financial year with related parties were in the ordinary
course of business and on an arm's length basis. During the year, the
Company had not entered into any contract / arrangement / transaction
with related parties which could be considered material in accordance
with the related party transactions policy of the company.
The Policy on dealing with related party transactions as approved by
the Board may be accessed on the Company's website. Your Directors draw
attention of the members to Note 29 to the financial statement which
sets out related party disclosures.
RISK MANAGEMENT
Business risk evaluation and management is an ongoing process within
the company. The assessment is periodically examined by the Board.
CORPORATE GOVERNANCE
Your Company attaches considerable significance to compliance with the
conditions of Corporate Governance under Clause 49 of the Listing
Agreement with the Stock Exchange. A Report on Corporate Governance is
hereto annexed.
INTERNAL FINANCIAL CONTROL
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. During the year, such controls
were tested and no reportable material weaknesses in the design or
operation were observed.
PARTICULARS OF EMPLOYEES
The information required under Section 197 of the Act read with rule
5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are given below:
a. The ratio of the remuneration of each director to the median
remuneration of the employees of the Company for the financial year:
Non-Executive Directors Ratio to median remuneration
Mr. S. S. Mishra 0.19
Mr. G. R.Toshniwal 0.21
Mr. M. A. Sharma 0.18
Mr. P. R.Kapadia 0.21
Mrs. Meeta Shingala* -
Executive Directors
Mr. R. K. Mishra, Managing Director 17.40
Mr. S. K. Mishra, Director-Finance 13.21
*Appointed w.e.f. 10th February, 2015, since this information is for
part of the year, the same is not comparable.
b. The percentage increase in remuneration of each director, chief
executive officer, chief financial officer, company secretary in the
financial year:
Directors, Chief Financial Officer % increase in remuneration
and Company Secretary in the financial year
Non-executive directors
Mr. S. S. Mishra 33.33
Mr. G. R.Toshniwal 33.33
Mr. M. A. Sharma 33.33
Mr. P. R. Kapadia 33.33
Mrs. Meeta Shingala* -
Executive Directors
Mr. R. K. Mishra, Managing Director 4.09
Mr. S. K. Mishra, Director-Finance 4.54
Ms. Vaishali Naik**, Company Secretary -
*Appointed w.e.f. 10th February, 2015, since this information is for
part of the year, the same is not comparable. **Appointed w.e.f. 1st
November, 2014, since this information is for part of the year, the
same is not comparable.
c. The percentage increase in the median remuneration of employees in
the financial year: 54 %
d. The number of permanent employees on the rolls of Company: 48
e. The explanation on the relationship between average increase in
remuneration and Company performance: On an average, employees received
an annual increase of 45%. The individual increments are based on
individual performance.
f. Comparison of the remuneration of the key managerial personnel
against the performance of the Company:
Aggregate remuneration of key managerial
personnel (KMP) in FY 14-15 (Rs. in lakhs) 27.25
Revenue (Rs. in lakhs) 7339.10
Remuneration of KMPs (as % of revenue) 0.37
Profit before Tax (PBT) (Rs. in lakhs) 121.22
Remuneration of KMP (as % of PBT) 22.47
g. Variations in the market capitalisation of the Company, price
earnings ratio as at the closing date of the current financial year and
previous financial year:
Particulars March 31,2015 March 31,2014
Market Capitalisation 232.50 192.80
( Rs. In lakhs)
Price Earnings Ratio 3.01 -*
Particulars % Change
Market Capitalisation 20.59
( Rs. In lakhs)
Price Earnings Ratio -
*As on 31st March, 2014, EPS was negative.
h. Percentage increase over decrease in the market quotations of the
shares of the Company in comparison to the rate at which the Company
came out with the last public offer [In the year 1993 at Rs. 20/- per
share (inclusive of premium of Rs. 10/- per share)]: (-) 89.75 %
i. Average percentile increase already made in the salaries of
employees other than the managerial personnel in the last financial
year and its comparison with the percentile increase in the managerial
remuneration and justification thereof and point out if there are any
exceptional circumstances for increase in the managerial remuneration:
- Average increase in the remuneration of all employees excluding KMPs:
45%
- Average increase in the remuneration of KMPs: 4 %
j. Comparison of each remuneration of the key managerial personnel
against the performance of the Company:
Mr. R.K.Mishra, Mr. S.K.Mishra,
Managing Director Director-Finance
Remuneration in FY 14-15 15.49 11.76
(Rs. in lakhs)
Revenue (Rs. in lakhs) 7339.10
Remuneration as % of Revenue 0.21 0.16
Profit before Tax (PBT) 121.22
(Rs. in lakhs)
Remuneration (as % of PBT) 12.77 9.70
Ms. Vaishali Naik,
Company Secretary*
Remuneration in FY 14-15 (Rs. in lakhs) 1.20
Revenue (Rs. in lakhs)
Remuneration as % of Revenue -
Profit before Tax (PBT) (Rs. in lakhs)
Remuneration (as % of PBT) -
'Appointed w.e.f. 1st November, 2014, since this information is for
part of the year, the same is not comparable.
k. The key parameters for any variable component of remuneration
availed by the directors:
There is no variable component of remuneration to the Directors.
l. The ratio of the remuneration of the highest paid director to that
of the employees who are not directors but receive remuneration in
excess of the highest paid director during the year: None.
m. Affirmation that the remuneration is as per the remuneration policy
of the Company:
The Company affirms remuneration is as per the remuneration policy of
the Company.
n. The information required pursuant to Section 197 read with Rule, 5
(2) and rule 5(3) of The Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 in respect of employees of the
Company is as follows:
a) Employed throughout the year- Nil
b) Employed for part of the year- Nil
AUDITORS
The auditors M/s. M.B. Agrawal & Co., and M/s. N.G. Thakrar & Co.,
retire at the conclusion of the ensuing Annual General Meeting. They
have furnished certificates of their eligibility for re-appointment.
SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT
The Board has appointed M/s Vikas R. Chomal & Associates, Practicing
Company Secretary, Mumbai to carry out Secretarial Audit under the
provisions of Section 204 of the Companies Act, 2013 for the financial
year 2014-15. The report of the Secretarial Auditor is annexed to this
report as Annexure - II.
DIRECTORS' RESPONSIBILITY STATEMENT
In terms of Section 134 (5) of the Companies Act, 2013, the directors
would like to state that:
(a) in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
(b) the directors had selected such accounting policies and applied
them consistently and made judgments and estimates that are 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 and of the Profit of
the company for that period;
(c) the directors had taken proper and sufficient care 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) the directors had prepared the annual accounts on a going concern
basis;
(e) the directors had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively and;
(f) the directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The Particulars with respect to energy conservation, technology
absorption, foreign exchange earnings and outgo, as required to be
disclosed under Section 134(3)(m) of the Companies Act, 2013, read with
Rule 8(3) of the Companies (Accounts) Rules, 2014 and forming part of
the Directors' Report for the year ended 31st March, 2015 are annexed
to this report.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
As required under the Listing Agreement, Management Discussion &
Analysis Report is attached and forms a part of this Report.
ACKNOWLEDGEMENT
The Directors wish to place on record their appreciation of the
contribution made by the executives, officers and workmen of the
Company during the year. The Board also acknowledges with thanks the
support, co-operation and assistance given by the Bank.
For and on behalf of the Board,
S. S. Mishra
Chairman
Mumbai, 30th May, 2015
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