The Members of
RAMA NEWSPRINT AND PAPERS LIMITED
Your Directors are pleased to present the 19th Annual Report and the AuditedAccounts for the Financial Year ended 31st March 2010.
(Rs. in lacs)
| ||Year Ended ||Year Ended |
| ||31.03.2010 ||31.03.2009 |
|Sales (Net of Excise Duty) ||30,911.72 ||34,222.03 |
|Other Income ||581.95 ||452.87 |
|Profit before Interest and Depreciation ||(108.10) ||2,200.99 |
|Less: Interest & Lease rent ||3,241.56 ||3,620.12 |
|Profit/(Loss) before Depreciation and Tax ||3,349.66 ||(1,419.12) |
|Less: Depreciation ||3,464.08 ||3,435.28 |
|Less: Current Tax (Fringe Benefit Tax) ||- ||17.00 |
|Less: Deferred Tax ||(1,149.18) ||(2,144.31) |
|Net Profit / (Loss) ||(5,664.56) ||(2,727.09) |
In view of the loss suffered by the Company during the year under review,the Company isnot in a position to pay any dividend.
PERFORMANCE DURING 2009-10
The historic recession which had embraced worldwide economy in the 2nd half ofF.Y.2008-09 continued its effect on the demand and consumption of Newsprint in the yearunder review also. The Company had to resort to supply management and also had to shift apart of production to Writing & Printing varieties so as to ease pressure onNewsprint. As a result, the saleable production during the year under review was 1,04,931MT (including 33,082 MT of Writing & Printing paper) against 1,24,509 MT (including 81MT of Writing & Printing paper) during 2008-09. The capacity utilization during theyear was lower at 80%. The Company registered a sales volume of 1,19,395 MT (including30,003 MT of Writing & Printing Paper) as against 1,09,111 MT (including 2,584 MT ofWriting & Printing paper) in 2008-09. The stock of finished goods which was 19,939 MTin the beginning of the year came down to 5,472 MT as on 31.03.2010.
The major impact on the profitability of the Company during the year is due tosubstantial dip in the capacity utilization, continued pressure on selling prices and notadequate and matching respite in the cost of inputs. However, the Company continued itsefforts to optimize the operating and productivity parameters at the mills.
The situation on the international front was also no different and especially countrieslike USA, Canada, Europe etc. continued to see negative growth and therefore had to resortto production cuts and shutting down of the uneconomic plants. However, from January March, 2010 quarter there was some upward movement in the international prices ofNewsprint, which brought back the hope of the bottoming up of the declining trend.
Inspite of the adverse condition as stated above, the Company met all its debtrepayment obligations successfully. However, with a view to strengthen its financials, theCompany plans to come out with a Rights Issue of Equity Shares of upto Rs.50 crores forwhich necessary steps have been initiated.
CURRENT YEAR'S PROSPECTS AND FUTURE PLANS
The consumption of Newsprint is directly linked to the growth in the economy.Fortunately, Indian economy showed a positive GDP growth of 7.5% in the F.Y. 2009-10 andit is expected to grow at about 9% during the F.Y. 2010-11. The signs of recovery areclearly visible in the growth in manufacturing and service sectors. The flow ofadvertisement has improved both from the Government sector and also the promotionaladvertisements from the Corporate sector. This has helped in increasing back thepagination of the newspapers and magazines and consequently has increased the consumptionof Newsprint in India.
Robust demand has helped the international players to push up the prices of Newsprintby about US $ 60/MT from the quarter beginning April,2010. The domestic manufacturerscould also get an increase of about Rs.2500-Rs.3000/MT during this quarter. However, thismuch jump in prices is not sufficient to meet the losses of manufacturers & thereforewith continuing growth in demand, it is expected that this trend will continue through-outthe year and the Company will be able to optimize the capacity utilization and improve theprofitability.
Further, the Company has identified certain low value Capex items with quick paybackperiod which shall improve the productivity at Mills and shall help in improving theprofitability of the Company. The Company is in the process of trying up funds for thesame.
Besides, the Company is planning to unlock the value of locked assets and for thispurpose have identified the following areas:
1. Export of surplus power from the existing power generating facility.
2. Earmarking about 250 acres of land for developing a Special Economic Zone.
The Company uses eco friendly recycled fibre as main raw material. The blending ofpurchased pulp is done as per the quality requirement in the final product. The recycledfibre and pulp are sourced from domestic sources as well as from imports. It is hearteningto note that world wide awareness for recycling and reuse of the precious fibre isincreasing and therefore the recovery percentage of recycled fibre is improving day byday. The Company is duly complying with all the requirements under Hazardous Material(Management, Handling and Transboundary Movement) Rules, 2007.
CORPORATE SOCIAL RESPONSIBILITY
The Company is conscious about its social responsibilities towards the public livingwithin the vicinity of its Mills. The Company continues to impart regular health checkfacilities for the community in the nearby villages and distribute free medicines to theneedy apart from supplying free Drinking Water on a regular basis to the nearby villages.
The Company has opened a modern English Medium School to impart quality education tothe students in the vicinity. In addition, the Company also undertakes various communitywelfare jobs as and when needed.
DIRECTORS' RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217 (2AA) OF THE COMPANIES ACT,1956
The Directors hereby confirm that: -
1. In the preparation of the annual accounts, the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
2. The directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit of the company for that period;
3. Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act, 1956 for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
4. The annual accounts have been prepared on a "going concern" basis.
The Company has not accepted any deposits from public during the year under review.
LISTING OF SHARES
Equity Shares of Company are listed on Bombay Stock Exchange Ltd. (BSE) and NationalStock Exchange of India Ltd. (NSE). The Company has duly paid listing fees to the stockexchanges.
During the year under review, Shri Vashu Ramsinghani and Shri Amit Ramsinghani resignedon 31st March 2010 due to their personal commitments.
The Directors place on record their appreciation of the valuable contribution made byShri Vashu Ramsinghani & Shri Amit Ramsinghani during their tenure as Directors of theCompany.
Shri S K Bangur, Shri Virendra Bangur & Shri K L Chandak are retiring by rotationat the ensuing Annual General Meeting and, being eligible, have offered themselves forre-appointment.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars with respect to Conservation of Energy, Technology Absorption, ForeignExchange Earnings and Outgo as required under Section 217(1)(e) of the Companies Act, 1956read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules,1988 are furnished as Annexure I to this Report and forms part of it.
PARTICULARS OF EMPLOYEES
Particulars of employees under Section 217(2A)of the Companies Act,1956 read withCompanies (Particulars of Employees) Rules,1975 as amended to date,are furnished as perAnnexure-IV
CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION & ANALYSIS
Report on Corporate Governance is made part of this Annual Report as Annexure IIand Management Discussion and Analysis Report as Annexure III.
As required by the Listing Agreements, the Certificate of Auditors on CorporateGovernance compliance is also annexed to this Annual Report.
The Certificate from CEO/CFO was placed before the Board of Directors at the meetingheld on 29th May 2010.
CASH FLOW STATEMENT
As required under clause 32 of the listing agreement with the Stock Exchanges, the CashFlow Statement is attached to the Balance Sheet.
The present Auditors of your Company, M/s. Haribhakti & Co., Chartered Accountantshold office until the conclusion of this Annual General Meeting and being eligible, offerthemselves for re-appointment.
The Notes to accounts, forming part of Balance Sheet as at 31st March 2010 and Profit& Loss Account for the year ended on that date, referred to in the Auditors' Reportare self explanatory.
The cost accounts records maintained by the company are subject to audit by thequalified Cost Auditors. Your Company has appointed Shri. Narottam Tola, a qualified CostAccountant for conducting the audit of cost account records for the year ended 31st March2010 and the Cost Audit report will be submitted to the Ministry of Corporate Affairs,Government of India in due course.
The industrial relations continued to remain cordial throughout the year under reviewexcept during the period from 12.1.2010 to 7.2.2010 when empoyee's unions were on strikefor wage revision and production suffered. However, despatches of finished goods continuedeven during the strike period. The management has entered into a long term settlement withthe employee's unions assuring complete industrial peace and harmony.
The Directors wish to place on record and acknowledge their appreciation and gratitudefor the continued co-operation and support received from the Central Government, the StateGovernment of Gujarat, Regulatory Bodies, participating Financial Institutions and Banks,Customers, Suppliers and Dealers. The Directors take this opportunity to express theirappreciation towards the dedication, commitment and teamwork shown by employees, which hascontributed in taking the Company on the path of prosperity. Your Directors further thankthe fraternity of Members/Shareholders for their continued confidence reposed in themanagement of the Company.
| ||By Order of the Board |
|Place: Mumbai ||S. K. BANGUR |
|Date: 29.05.2010 ||CHAIRMAN |
ANNEXURE TO DIRECTORS REPORT
INFORMATION AS PER SECTION 217(1)(e) READ WITH COMPANIES (DISCLOSURE OF PARTICULARS INTHE REPORT OF BOARD OF DIRECTORS), RULES, 1988 AND FORMING PART OF THE DIRECTORS' REPORTFOR THE YEAR ENDED 31st MARCH 2010.
A. CONSERVATION OF ENERGY
1. ENERGY CONSERVATION MEASURES TAKEN:
Following measures have been taken during 2009-10 for energy conservation
i) Firing of ETP sludge in Boiler.
ii) Trimming of Impeller of Dump Tower Feed Pump in FDP-II.
iii) Reduction in Speed of Gould Pump in FDP-II
iv) The recirculation pump of Dump Tower of FDP-I has been stopped without any effecton process performance.
v) Replacement of motor in FDP-II with standard 415 V ABB make motor.
vi) Trimming of impeller of Krofta Feed Pump (by 8%) in FDP-II.
vii) The speeds of FDP-I Dump chest agitator & FDP-II storage tower agitatorreduced by 10%..
viii) The standby pump (with 75 Kw Motor) in FDP-I taken into operation in place ofpump (with 110 KW motor)
ix) Replacement of blades of New Cooling Tower Fans No. 1,2 & 3 by energy efficientFRP blades of modified design.
x) Secondary Fine screen Motor in FDP-I converted from Delta connection to Starconnection.
xi) The speed of HD Tower Agitator in FDP-I was reduced by changing the motor pulley.
xii) In Paper Machine No.-II Blending Chest bypassed and thus saving power consumptionof one pump and one agitator. (During Newsprint run only)
xiii) The speed of De-ink chest agitator in Paper Machine II is reduced by changing thepulley.
xiv) In compressor House Refrigeration Air Dryer started in place of HOC dryer.
2. WATER CONSERVATION MEASURES TAKEN:
i) Reuse of drain water at W.T.P from Lamella Clarifier .
ii) Utilization of rain water collected in guard pond for use as make up water in FireReservoir tank.
iii) Fresh Water replaced with ETP water in gland cooling circuit of Drum screen acceptpump & Sludge chest pump in FDP-I.
iv) Sealing water for Vacuum pump of M. C. Pump replaced from fresh water to ETP waterin FDP-I.
v) Sealing water for Vacuum pump no.1 and 2 of ENSO washers replaced from fresh waterto ETP water in FDP-II.
vi) Replacement of use of Fresh Water for cleaning at Basement under the dryer hood andfor fire emergency hose pipe tapping with ETP Water in Paper Machine No.-II.
vii) Use of Back water for make up water in clear water tank in Paper Machine No.-II toreplace fresh water.
3. ENERGY CONSERVATION MEASURES PROPOSED FOR FUTURE:
i) To reduce the power and air consumption in compressor house, small size paperfeeding nozzles will be provided in both the Paper Machines.
ii) Replacement of the blades of Paper Machine Hood exhausts fans by Energy EfficientFRP Fans.
iii) To replace existing propeller of both machine chest and broke dump chest to reducepower consumption.
iv) Reduce the speed of dry-end pulper by 15% to reduce power consumption in PaperMachine No.-I.
v) To replace the existing 132 KW motor of Primary pressure screen in Paper MachineNo.-I by a new 110 KW motor.
vi) Installation of VFD in Power Boiler CE-4 & AP-2 Fans for power saving.
4. WATER CONSERVATION MEASURES PROPOSED FOR FUTURE:
i) To reduce fresh water consumption by utilization of Cooling Tower blow down water asmake up water in fire reservoir.
ii) To reduce fresh water consumption by utilization of back wash water of ACF &DMF unit of DM plant in Cooling Tower.
iii) To reduce the consumption of fresh water in paper machines, excess back water canbe stored and used when required. Proposed for storing back water storage tank of 800 M3Capacity is under consideration.
iv) To instal suitable Instrument Valve in Wire lubrication shower main header toreduce the Water consumption during wash-up.
5. IMPACT OF MEASURES (1&2) ARE:
Reduction in consumption of Fresh water & Power consumed for production ofNewsprint Papers as well as Writing and Printing Papers. Specific water consumption willalso come down during normal running of plant. Apprx. reduction in power consumption of3200 kWH/Day and reduction in water consumption of 457 M3/day of paper is achieved overthe previous year.
B. TECHNOLOGY ABSORPTION
Effort made in Technology Absorption adoption & innovation as per Form B enclosed.
C. FOREIGN EXCHANGE EARNING AND OUTGO
Rs. (In Lacs)
| ||Current year ended 31.3.2010 ||Previous year ended 31.3.2009 |
|Foreign Exchange Earning ||1,066.95 ||95.42 |
|Foreign Exchange Used ||8,170.62 ||8,806.23 |
FORM - A
Form of Disclosure of particulars with respect to Conservation of Energy
|A) ||Power and Fuel Consumption || || |
|Sr. No. || ||For the Year ended 31.03.10 ||For the Year ended 31.03.09 |
|1. ||Electricity || || |
| ||a) Purchased || || |
| ||Units (Kwh in thousand) ||2522 ||4974 |
| ||Total Amount (Rs. in lacs) ||356.27 ||494.76 |
| ||Rate/Unit (Rs) ||14.12 ||9.95 |
| ||b) Own Generation || || |
| ||I. Through Diesel Generator || || |
| ||Units (Kwh in thousand) ||2 ||35 |
| ||Unit per Litre of Diesel/Oil ||3.31 ||3.47 |
| ||Rate/Unit (Rs) ||10.38 ||8.92 |
| ||II. Through Steam Turbine/Generator || || |
| ||Unit (Kwh in thousand) ||11,3128 ||1,26,666 |
| ||Rate/Unit (Rs) ||2.73 ||2.73 |
|2. ||Coal || || |
| ||Quantity (MT) ||13,5085 ||1,57,902 |
| ||Total Cost (Rs. In lacs) ||4,326.48 ||5,249.60 |
| ||Average rate (Rs. Per MT) ||3203 ||3325 |
|3. ||Furnace Oil || || |
| ||Quantity (K.Ltr) ||Nil ||Nil |
| ||Total Amount (Rs. In lacs) ||Nil ||Nil |
| ||Average rate (Rs. Per K. Ltr) ||Nil ||Nil |
B) Consumption per MT of Production of Newsprint / Writing & Printing Paper
| ||For the Year ended 31.03.10 ||For the Year ended 31.03.09 |
|Electricity (kwh) ||1,102 ||1,050 |
|Furnace Oil (K. Ltr) ||Nil ||Nil |
|Coal (kgs) ||1,287 ||1,260 |
Form for disclosure of particulars with respect to Technology Absorption
RESEARCH AND DEVELOPMENT ( R & D)
i. Lab evaluation of raw material for developing writing & printing grade paper.
ii. Lab study carried out to select specialty chemicals/ additives for writing &printing grade paper.
iii. Lab studies followed by plant trial carried out to select alternative source ofDye for cost reduction without effecting quality and one indigenous product has beensubstituted with imported chemical. Substantial cost reduction achieved.
iv. Development of high brightness maplitho & IPO grade paper.
v. Based on lab scale results, plant trial of de-inking chemical for writing &printing paper for cost effectiveness was taken and established.
vi. Lab and plant trials carried out to evaluate the performance of using cationicstarch with respect to fluff reduction. Substantial fluff reduction achieved along withcost reduction by way of better retention, improved high ash and sheet properties.
vii. Lab evaluation of five OBA samples against existing chemical being used, twoproducts selected as substitute
viii. Based on lab results, plant trial of OBA initiated for better brightness andwhiteness on paper.
ix. Lab study followed by plant trial was taken as alternative indigenous source ofbiocide for cost reduction without affecting quality and machine run ability. Product isestablished with cost reduction.
x. Lab study carried out to select alternative source of PAC for sludge dewatering forcost reduction and substantial cost reduction achieved.
xi. Mapping of different process parameter of FDP-I & FDP-II for processimprovement.
TECHNOLOGY ABSORPTION,ADOPTION AND INNOVATION
1. Efforts in brief made towards technology absorption, adoption and innovation:
i] Firing of ETP sludge in CE-4 Boiler furnace as non conventional fuel throughexisting under feed system alongwith coal.
ii] Installation and commissioning of Variable Frequency Drive (VFD) in the Screw Pressat E. T. Plant for better removal of moisture from the sludge.
iii] Installation of Online Dryer screen cleaning system in Paper Machine No.-I
iv] Up-gradation of UNIX based station by Window XP system.
2. Benefits derived as a result of above efforts:
i] Use of waste by-product and reduction in coal consumption.
ii] Improvement in dryness of ETP sludge.
iii] To have better control over sticky breaks and reduced steam demand due to betterpermeability of fabric after installation of Online Shower
iv] Improved/upgraded technology for reliability in operation.
3. Details of Project Development work in the field of Energy which are inProgress:
i] Up-gradation of Dense Phase Ash Handling System for Power Boiler AP-2.
ii] Electronic governor & DCS system for Siemens Turbo Generator.