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1996
COSMOS APPARELS LIMITED
DIRECTORS REPORT
Yours Directors have pleasure in presenting the 2nd Annual Report and the
Audited Statement of Accounts of the Company by the financial year ended
31st March, 1996.
ACCOUNTS
As the Company had no manufacturing or trading activities during the
financial year ended on 31st March, 1996, no Profit & Loss Account has been
prepared.
PROJECT
PRESENT ACTIVITIES
As the members are aware that your company had successfully tapped the
capital market in the month of October 1995 with 4472800 equity shares of
10/- each for cash at par which was over-subscribed due to the overwhelming
response of the member investors. Directors are thankful to all of them for
their such a good response.
Your company is presently engaged in a project to manufacture Apparels at
large scale which is under implementation at Naroda, Ahmedabad, which is
near about completion. Against the earlier planing the Naroda is very
nearer to the city of Ahmedabad and Khatraj Industrial Area has not been
developed so far as all were expected earlier. Now a days it is suffering
from lack of skilled labour and new site at Naroda, Ahmedabad which is
within the municipal limits and which is having enough power supply and
bore to ensure water supply and further the required skilled labour resides
in within 2Km. circumference of the factory premises. Thus considering the
above benefits availability of transportation and all infrastructure
facilities has led the Board to take the decision to shift the proposed
project from Khatraj to Naroda. Further as the members are aware that your
Company has not commenced production during the year hence comparision of
promises verses performance has not been given.
Further as the members are aware that since the whole India Economy is
suffering from liquidity crunch which continues to deepen and increase in
cost of Exports, not only Textile but also every industry is facing
recession. Exports in all sectors are declining sharply. Further the badly
suffered companies are those who are enjoying 100% E.O.U. Status, and
finding themselves unable to fulfill their export obligations. Hence
considering aforementioned disadvantages your directors are unwilling to
continue 100% E.O.U. Status of the company and have decided not to
undertook export obligation by signing the agreement of 100% E.O.U. So that
the company will be under no compulsion to export even at incurring losses.
However your directors have decided to go for exports in normal and usual
way, besides capturing the domestic market which is having enough
scope to fetch the targetted turnover. Hence company will be in a
position to achieve the projected figures without E.O U. status and try to
achieve maximum export without E.O.U. status.
PROPOSED ACTIVITIES
Besides the existing project to manufacture Apparels your directors were
engaged in exploring the possibilities to expand company's activities from
the existing one and accordingly as measure of backward integration they
have decided to go for processing of the fabrics through process house for
processing of cotton fabrics at Ahmedabad. The company has chosen Mr.
Gulabrai. R. Ajwani, who is relative of Jayesh Ajwani Managing Director and
having vast experience of more than 20 yrs. of this line to go on this
project who will be assisted by the team of experts in this field. The
company has entered into a M.O.U. with G. R. Ajwani where by Mr.G. R.
Ajwani will initially have to arrange and handover a process house in
running condition to the company. As a first step towards the same the
company has started spending on Unit II (Process House) which is situated
at Narol Area of Ahmedabad city Which is well known Industrial Area nearer
to Naroda site.
Further to manage the present and future activities and feeling the need to
have its own office premises at or nearby Paldi, Ahmedabad. The company
through Mr.G. R. Ajwani is going for a well furnished sophisticated hitech
office premises in the said area to smoothen & strengthen its
administrative power, which is expected to be completed within 2-3 months
in the near future.
AUDITORS
M/S Deepak C. Gandhi & Co., Auditors of the company hold office until the
conclusion of the ensuing Annual General Meeting and the company has
received a letter from them of their unwillingness to continue as the
auditors due to some personal reasons. Hence M/s. Kirti J. Nayak &
Associates, chartered accountants are proposed to be appointed as auditors
of the company in place of M/S Deepak C. Gandhi & Co. The company has
received a letter from them to the effect that their appointment, if made
would be within prescribed limits under section 224(I-B) of the Companies
Act, 1956, accordingly the present auditors will retire and M/S Kirti J.
Nayak & Associates are proposed to be appointed in his place at the ensuing
Annual General Meeting.
FIXED DEPOSITS
During the year under review your company has not invited any fixed
deposits from public in terms of provisions of Section 58-A of the
Companies Act, 1956 and the rules frames thereunder.
PERSONNEL
None other employees of the company getting remuneration in the excess as
required by the provisions of Section 217(2A) of the Companies Act 1956.
DIRECTORS
Mr. Sattar E. Kherani Director of the company retires by rotation and being
eligible offers himself for re-appointment.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING
AND OUT GO
Information as per Section 217 (1) (e) of the Companies Act, 1956, read
with the Companies (Disclosure of particulars in Report of the Board of
Directors) Rules, 1988 and forming part of the Director's Report for the
year ended 31st March, 1996 is as under :
CONSERVATION OF ENERGY
Since the project is in the implementation stage and no commercial
production has begun till the date of the report, no disclosure is
necessary in respect of conservation of energy.
TECHNOLOGY ABSORPTION
As the technology used to manufacture the product is simple, no technology
absorption is necessary.
FOREIGN EXCHANGE EARNINGS AND OUTGO
Since the project is in the implementation stage and no commercial
production has begun till the date of the report, there is no foreign
exchange earnings and outgo.
ACKNOWLEDGEMENT
Your Directors place on record their appreciation of the assistance and
support extended by the Government authorities, Banks, Legal Advisors
Share- holders of the company.
Your directors express their appreciation for the dedicated and sincere
services rendered by employees of the company.
For and on behalf of the board
Jayesh G. Ajwani
(Managing Director)
Sattar E. Kherani
(Director)
Place : Ahmedabad
Date : 27.11.96
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