TO THE MEMBERS OF
KOTHARI FERMENTATION AND BIOCHEM LTD.
Your directors are pleased to present the 23rd Annual Report together with the AuditedAccounts for the year ended on 31st March 2013:
1. FINANCIAL RESULTS
(Rs. in lacs)
| ||2012-2013 ||2011-2012 |
|Turnover ||4390.50 ||3524.90 |
|Profit before Finance Charges & Depreciation ||505.48 ||478.67 |
|Finance Charges ||118.22 ||103.44 |
|Depreciation ||149.43 ||143.04 |
|Profit before Tax ||237.83 ||232.19 |
|Taxes (Deferred Tax) ||73.86 ||71.80 |
|Net Profit/ (Loss) after Tax ||163.97 ||160.39 |
The introduction of professional approach towards management of the resources of thecompany helped in the company's growth and efficient and effective utilization of thesame. During the year, capital expenditure incurred on equipments resulted in betterutilization of plant & machineries. Also various steps initiated in the previous yearsfor increasing production and improving operating efficiencies have paved the way towardsmeeting the growth targets of the company.
The company achieved production of 9702 MT during 2012-13 as compared to 8481 MT inprevious year. Resultantly the turnover of the company from manufacturing activities hasincreased to Rs. 4390.50 Lacs during the year 2012-13 as compared to Rs. 3524.90 Lacsduring previous year recording the growth of 24%. The profitability of the company is Rs.163.97 Lacs during the year 2012-13 as compared to profit of Rs. 160.39 Lacs duringprevious year.
Dividend for the year has not been proposed in order to plough back profits for thegrowth of the Company.
3. CURRENT YEARS OUTLOOK
In view of the efforts made, it is noteworthy to mention that the company achievedpositive results even against the backdrop of general slowdown in the economy and greaterstress in several other industries, such as textiles, steel, mining, infrastructure, etc.
Also the company has made additional investments in plant & machineries and isoptimistic of achieving higher levels of production. Various control systems have beendeployed for the reduction of costs and improving of the operating efficiencies.
Further, it is expected that the production and profitability of the company willsubstantially improve during the current year.
4. FIXED DEPOSITS
The Company has not accepted any deposit from public during the year under review,which would fall under section 58-A of the Companies Act, 1956.
During the year, the company suffered with an irreparable loss in the form of suddendemise of Mr. Moti Lal Kothari, Chairman of the Company on 03.09.2012.
Mr. Moti Lal Kothari, was a great visionary, a great leader and above all a greathumanist who showered equal love and regard for all irrespective of their positions insociety.
He was the Promoter Director of the Company, whose contributions were commendable andunparallel. His sincere efforts, guidance and wise advises helped the company achieve itspresent position and hope that it would flourish and fulfill the dreams and visions assought by our beloved Mr. Moti Lal Kothari.
In accordance with the provisions of the Companies Act, 1956 and the Articles ofAssociation of the Company, Mr. Ratan Lal Dudheria is retiring from the Board by rotationand being eligible offers himself for reappointment.
Mr. Pramod Kumar Kothari was appointed as the Managing Director by the Shareholders inthe AGM held on 30.09.2009. Due to the sad demise of Mr. Moti Lal Kothari,responsibilities of Mr. Pramod Kumar Kothari, Managing Director of the Company hastremendously increased, thus, he is proposed to be re-appointed with varied terms andconditions.
Mrs. Kavita Devi Kothari was appointed as Additional Director by the Board on01.04.2013. She was also appointed as the Whole-Time Director of the Company w.e.f.01.04.2013 for a period of 5 (Five) years, subject to the approval of the members in thisAnnual General Meeting.
The Board recommends their appointment as such.
6. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Sec.217 (2AA) of the Companies Act, 1956 the directors hereby report: ithat in the preparation of the annual accounts, the applicable accounting standards havebeen followed along with proper explanation relating to material departures; ii that thedirectors have selected accounting policies and applied them consistently and madejudgment and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year 2012-13 and of theprofit of the company for the year, iii that the directors have taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act for safeguarding the assets of the company and forpreventing and detecting fraud and other irregularities, iv that the directors haveprepared the annual accounts on a going concern basis.
7. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS ANDOUTGO
The statement containing the necessary information under section 217(1)(e) of theCompanies Act, 1956 read with the Companies (Disclosure of Particulars in the Report ofthe Board of Directors) Rules, 1988, is annexed to this report as
Your company maintains harmonious and cordial relations with all its employees. Noemployee is drawing salary more than the limits prescribed under section 217 (2A) of theCompanies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975.
M/s Nahata Jain & Associates, Chartered Accountants (Regn. No. 016351N), auditorsof your company retire at the ensuing annual general meeting and being eligible offersthemselves for re-appointment. The Board recommends their appointment as auditors from theconclusion of this meeting to the conclusion of next annual general meeting. The notes onaccounts are self-explanatory with regards to auditors' observations.
10. COMPLIANCE CERTIFICATE FROM COST AUDITORS
Pursuant to section 233B of Companies Act, 1956 read with Cost Audit Rules 2011, theCompany will receive the Cost Audit Report for the Financial Year - 2012-13 from M/s HMVN& Associates, Cost Accountants, Delhi and would file the same with the Governmentwithin stipulated time.
The Cost Audit Report for the financial year 2011-2012 which was due to be filed withthe Ministry of Corporate Affairs on or before January 31, 2013 was filed on January 22,2013.
The Board of Directors of your Company has recommended M/s HMVN & Associates, CostAccountants, Delhi to be appointed as a Cost Auditors for the Financial Year-2013-14,subject to approval of the Central Government under section 233B of the Companies Act,1956.
11. CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a CorporateGovernance Report is made a part of this annual report.
A certificate from the auditors of the Company regarding compliance of the conditionsof Corporate Governance as stipulated by Clause 49 of the Listing Agreement is attachedwith this report.
The Company is complying with Clause 49 of the Listing Agreement with regard toCorporate Governance and reports to that effect are being regularly filed with the StockExchanges. The Company has obtained declaration from the Directors and Senior Managementmembers of the Company for compliance of code of conduct and the Certificate from CEO/CFOwas placed before the Board of Directors.
12. MANAGEMENT DISCUSSION AND ANALYSIS
A report on Management Discussion and Analysis (MDA), which forms part of this Report,inter-alia, deals adequately with the operations and also the current and future outlookof the Company.
Your Board of Directors are thankful to all the Shareholders for their constant faithreposed in the company. They also placed on record their sincere appreciation for thewholehearted devotion and co-operation extended by the employees at all levels, which hasbeen a source of strength to the company.
The Directors also wish to thank and deeply acknowledge the continued support, guidanceand co-operation of the Customers, Auditors, Legal Advisers, Bankers, Dealers, Vendors andother stakeholders of the Company.
| ||For and on behalf of the Board |
|Place : New Delhi ||Pramod Kumar Kothari |
|Date : 12th August, 2013 ||Managing Director |
INFORMATION AS PER SECTION 217 (1) (e) READ WITH COMPANIES (DISCLOSURE OF PARTICULARSIN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988 AND FORMING PART OF THE DIRECTORS REPORTFOR THE YEAR ENDED MARCH 31, 2013.
(I) CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO.
1. CONSERVATION OF ENERGY, POWER AND FUEL CONSUMPTION
The company, in order to conserve its Energy, Power and Fuel Consumption, has startedusing agro - fuels in the form of Husk, which helps in better steam generation and thusreducing costs. The use of Agro-Fuel in the Manufacturing Process has the advantage ofreduced emission of greenhouse gases. They are a much cleaner source of energy thanconventional sources. Hence, an environment - friendly source of Steam Generation byboilers.
| ||FOR THE YEAR ENDED ON 31ST MARCH, 2013 ||FOR THE YEAR ENDED ON 31ST MARCH, 2012 |
|a) Electricity || || |
|Units Consumed ||8586000 ||8005538 |
|Total Amount (Rs. in Lacs) ||553.30 ||458.56 |
|Rate/Unit Rs. ||6.44 ||5.73 |
|b) HSD/Furnace Oil || || |
|Quantity (litres) ||228000 ||46540 |
|Total Amount (Rs. in Lacs) ||92.13 ||17.23 |
|Average Rate per Ltr. (Rs.) ||40.41 ||37.02 |
|c) Agro Fuel || || |
|Quantity (MT) ||7329.75 ||3541.18 |
|Total Amount (Rs. in Lacs) ||265.16 ||125.76 |
|Average Rate per MT (Rs.) ||3617.56 ||3551.76 |
2. TECHNOLOGY ABSORPTION & RESEARCH AND DEVELOPMENT
Through continuous Research and Development efforts, the company has been able tomaintain the quality of yeast products as compared with its competitor multinationalcompanies. The company is constantly working to enter into markets, other than Bakeries,and had engaged a team of talented scientists and engineers to develop technologies forthe manufacturing of Yeast based products needed for Distilleries, Feed, FoodPharmaceuticals and Biotech Industries.
|EXPENDITURE ON RESEARCH AND DEVELOPMENT || || |
|a) Capital (Rs. in lacs) ||2.66 ||1.88 |
|b) Recurring (Rs. in lacs) ||17.59 ||17.95 |
|c) Total (Rs. in lacs) ||20.25 ||19.85 |
|d) Total R & D expenditure as percentage of turnover of Manufacturing activity ||0.46 ||0.56 |
|3. FOREIGN EXCHANGE EARNINGS AND OUTGO || || |
|Foreign exchange earnings (Rs.in lacs) || || |
|Foreign exchange outgo (Rs.in lacs) ||42.46 ||201.82 |