JAYANT PAPER MILLS LIMITED
Your Directors have pleasure in presenting their Thirty Sixth Annual Report
and Audited Accounts for the year ended on 31st March, 1996.
Your Directors are pleased to recommend dividend at the rate of Rs. 1.70
(Rupee one and paise seventy only) per share on 12,55,370 fully paid up
Equity shares of Rs. 10/- each for the whole year and on 23,66,240 Equity
Shares of Rs. 10/- each e Rs. 0.012 per share on which an amount of Rs.
2.50 per share has been paid up for the period, commencing from the date of
allotment i.e. from 20th March, 1996 uptil 31st March, 1996.
The production of Paper & Paper Board during the year under review has
declined to 18332 M.T. as against 19668 M.T. in the previous year. However,
Sales turnover has marginally increased by 9% from Rs. 3279 lacs to Rs.
3577 lacs. The Gross profit and Net Profit declined substantially on
account of various adversities experienced during the year under report.
The power cut ranging to 25% since last 4 months has resulted into
production loss to the tune of 1620 M.T. during later half of the year. The
Central Government has allowed free import of Newsprint without duty
payment. Due to sluggish conditions prevailing in foreign markets; the
heavy dumping took place which resulted into offering of imported Newsprint
at low prices which compelled the indigenous industry to reduce the price
of Newsprint despite increase in the cost of production. Similarly due to
import of Paper & Paper Board under Open General Licence at relatively low
prices the demand for domestic products substantially reduced compelling
the Company to reduce the selling price. Cost of labour also increased
substantially in view of higher wages paid on account of finalisation of
wage settlement during the year under review. Owing to high Foreign
Exchange rate during the last quarter of the financial year the Company has
to incur higher cost for import of raw-material from the foreign market.
The power and energy cost have also increased disproportionately. All these
factors have adversely affected the performance of the Company during the
second half of the year under review.
Consequent upon liberalisation of trade policies and in the wake of
globalisation of Indian economy to the World economy the Government has
allowed free import of Newsprint without duty payment. Similarly free
import of Paper & Paper Board has also been allowed resulting into
intensive competition in the domestic market particularly for industries
engaged in manufacturing activities of Paper & Paper Board However, as a
strategic move, your Directors have decided to curtail the production of
low profitable items and intensify the production of items which could
fetch better yield. The Expansion Programme would help your Company in
achieving economies of scales and better results in terms of higher sales
turnover and better profitability.
RIGHTS ISSUE OF THE COMPANY
During the year under review, your Company has offered 2510740, Equity
Shares of Rs. 10/- each at a premium of Rs. 30/- per share on rights basis
to the existing shareholders of the Company in the ratio of 2 Equity Shares
for every one share held in terms of Letter of Offer dated 18th November,
1995. The Company has received subscription of 94.24% against the offer
made. Your Directors have made allotment of 2366240 Equity Shares on 20th
March, 1996 and the relative Share Certificates and refund orders in
respect thereof have been delivered to all the shareholders of the Company.
The Rights Equity Shares have been enlisted at the Ahmedabad, Mumbai &
Vadodara Stock Exchanges. The Board of Directors have made call for the
allotment money @ Rs. 10/- per share.
Your Directors are pleased to inform you that the Company has received
second hand imported Paper Machine from West Germany. The machine is
capable of manufacturing 80 tons per day of Newsprint as well as other
varieties of writing & printing paper. The other modelities for expediting
the Expansion Programme is in full swing. The Company has been in the
process of mobilising the resources so as to provide necessary funds for
completion of Expansion Programme at the earliest.
EFFLUENT TREATMENT - ZERO DISCHARGE SYSTEM
The Company is required to comply with the Pollution Control norms strictly
as per the directives of State Pollution Control Authorities. The Company
has decided to install a zero discharge system at a capital outlay of Rs.
50 lacs so as to ensure optimum use of process water by recycling the same
after proper treatment to curtail the fresh water consumption to save the
The Company has not accepted/renewed Fixed Deposits from public and its
Shareholders during the year as the deposit scheme has been discontinued.
All the deposits matured so far have been repaid except deposits unclaimed
by few depositors.
The Company proposes to raise fixed deposits in the current financial year
with a view to augment the short and medium term resources to meet the
requirement of funds for the expansion project as well as for working
capital requirement. The Company has initiated dialogue with Managers with
a view to raise Rs. 250.61 lacs as per the provisions of the Companies Act,
The Company has made adequate arrangements for insuring its properties and
assets against fire and other probable risks.
The Accounts for the year ended on 31st March, 1996 of M/s. JAYANT PACK
(GUJARAT) LIMITED, a wholly owned subsidiary of the Company, are annexed
Pursuant to Article 126 of the Articles of Association of the Company, Shri
R.M. Gandhi, Shri. C.R. Mehta and Shri. V.H. Mehta retire by rotation at
the ensuing Annual General Meeting and being eligible offer themselves for
M/s. M.A. Parikh & Co., Chartered Accountants and M/s. J.L. Bhatt & Co.,
Chartered Accountants, present Auditors of the Company retire at the
conclusion of the ensuing Annual General Meeting. They have furnished a
certificate of eligibility for their reappointment pursuant to Sec. 224 (1
B) of the Companies Act, 1956. Members are requested to appoint Auditors
for the current year and to fix their remuneration. In the opinion of the
Board of Directors, no provision is required to be made for the items
mentioned in point no. 5 of the Auditors Report as the Company has disputed
the same before various authorities. Other observations made in the
Auditors Report are self explanatory and therefore do not call for any
Shri D.K. Visariya, Cost Accountant, has been appointed as Cost Auditor for
conducting the audit of the Cost Accounts maintained by the Company
relating to "Paper" for the year ended on 31st March, 1996.
ENERGY CONSERVATION AND TECHNOLOGY ABSORPTION
As required by the Companies (Disclosure of Particulars in the Report of
Board of Directors) Rules, 1988 the relevant data pertaining to
conservation of energy and technology absorption are given in the
prescribed format as Annexure I to this report.
PARTICULARS OF EMPLOYEES
A statement giving particulars of Employees pursuant to Section 217 (2A) of
the Companies Act, 1956 as amended is given in the Annexure II of this
COMPARISION OF PERFORMANCE VS. PROJECTION.
In terms of Clause 43 of the Listing Agreement a statement giving
comparision of performance vs. projection is given in Annexure - III of
Your Directors place on record their appreciation for the untiring efforts
made by the Managing Directors Shri H.R. Mehta, Shri Y.H. Mehta, Executive
Director Shri M.H. Mehta and the officers, employees and workers at all
levels during the year under review.
Your Directors also acknowledge with gratitude for the co-operation and
financial assistance extended by Gujarat Lease Financing Ltd. and Uco Bank
during the year under review.
A. Conservation of Energy : Current Year Previous Year
(I) Power and Fuel Consumption :
a. Purchased Unit
(in 000 Kwh) 15708 17184
b. Total Amount
(Rs. in lakhs) 418.01 425.88
Rate/Unit (Rs.) 2.66 2.48
2. Natural Gas
Quantity (M3) 3969507 3887663
Total Cost (Rs. in lakhs) 108.40 98.24
Average Rate (Rs. per 1000 M3) 2738 2527
(II) Consumption per unit of Production
(Product-Paper & Paper Board)
Electricity KWH/M.T. 857 874
Furnace Oil Ltr./M.T. - -
Natural Gas M3/M.T. 216.54 197.66
B. TECHNOLOGY ABSORPTION
(I) RESEARCH AND DEVELOPMENT (R & D)
Expenditure on R & D.
The Company has incurred revenue expenditure to the tune of Rs. 26722/-
during the year under report.
(II) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
1. The Company has successfully completed the project of on line top layer
coating : The feasibility to install equipments for bottom layer coating of
Duplex Board is in progress.
2. Benefits to be derived as a result of the above efforts : Value added
product with better market acceptability due to wider use for packing of
C. FOREIGN EXCHANGE EARNING AND OUTGO
The Company has incurred foreign exchange expenses to the tune of Rs.
1177.99 lacs during the year under report. Out of above expenses, Rs.
581.76 lacs has been spent for procuring Second hand Plant and Machinery
for implementing the Expansion Project. There has not been any Foreign
Exchange earnings during the year under review.
For and on behalf of the Board of Directors.
Y.H. MEHTA MANAGING DIRECTOR
G.C. SHAH DIRECTOR
Place : Mumbai
Dated : 29th June, 1996.