DirectorsYour Directors have pleasure in presenting the Twenty Fifth Annual Report on thebusiness and operations of the Company and the Audited Accounts for the Financial Yearended 31st March 2011.
1. Financial Results
(Rs. in Lacs)
| Particulars | 2010-2011 | 2009-2010 |
| Sales (net of excise duty) and other income | 9347.09 | 7108.33 |
| Profit Before Interest and Depreciation | 614.07 | 590.56 |
| Less : | | |
| a) Interest | 337.90 | 206.68 |
| b) Depreciation | 98.87 | 95.46 |
| PROFIT / LOSS BEFORE TAX & EXTRA ORDINARY ITEMS | 177.30 | 288.42 |
| Add : Interest on I.T.Refunds | 1.61 | 0.45 |
| Add : Excess Provision written back | 0.38 | 0.18 |
| Less : Prior year’s I T Adjustments | (2.25) | 44.21 |
| Less : Foreign currency Montetary Item Translation | | |
| Difference Account Write Off | 2.47 | 2.70 |
| PROFIT BEFORE TAXATION | 179.08 | 242.14 |
| Provision for Tax - Current | 67.35 | 80.00 |
| - Deferred | (4.47) | 8.60 |
| PROFIT AFTER TAX | 116.20 | 153.54 |
| Balance brought forward from previous year | 869.17 | 760.24 |
| Amount available for appropriation | 985.37 | 913.78 |
| APPROPRIATION | | |
| Transfer to Foreign currency Monetary Item | 0.11 | 0.00 |
| Translation Difference | | |
| Proposd Dividend on Equity Share | 19.07 | 38.13 |
| Corporate Dividend Tax on above | 3.17 | 6.48 |
| Balance Carried over to next year | 963.13 | 869.17 |
2. Dividend:
Your Directors recommend 5% dividend on Company’s paid up equity share capitalcomprising of 38,13,400 equity shares of Rs. 10/ - each. Thus, the total dividend outgofor the current fiscal will amount to Rs. 21.54 lacs including dividend distribution taxof Rs. 3.17 lacs as against Rs. 44.61 lacs including dividend distribution tax of Rs. 6.48lacs in the previous year.
3. Operational Highlights:
During the year under review, your Company has achieved Sales of Rs. 9347.09 lacs asagainst Rs. 7108.33 lacs in the preceding year, showing volume growth of around 31.49%.Out of the total sales, the Company has achieved sales worth Rs. 7841.81 lacs towardssales of Distribution & Power Transformers which accounts for around 84.58% of totalsales. The exports of the Company steadily grew from Rs. 846.44 lacs in the previous yearto Rs. 904.52 lacs in the current year.
The Company has recorded a profit after tax Rs.116.20 lacs as compared to Rs. 153.54lacs in the financial year ended 2009-10. The margins are depleted due to increase in rawmaterial prices, manufacturing and operating cost and finance cost.
The efforts are made to reduce operating and finance cost, to minimize movement of rawmaterials, components and labour, to improve designs and lay outs and to enhance overallefficiency. Simultaneously, the Company is developing energy efficient transformers havingapplication in Solar, Windmill and Hydel projects. This Green initiative adopted by yourCompany will apart from contributing towards social cause will help in achieving betteryields and to lead for improving bottom line.
4. Accreditation:
Your Company has been authorized by the Bureau of Energy Efficiency (BEE) for usingthree (3) Star Rating labels on its Distribution Transformers with the capacity of25KVA/63KVA/100KVA and 200KVA, respectively and during the period under review, it hasapplied for upgrading the same to four (4) Star Rating labels.
The Company is also holding ISO 9001:2000 Certificate since September, 2004 for qualitysystems in relation to its factory located at village Bil, District Vadodara in the Stateof Gujarat.
5. Finance:
The Company has been optimally utilizing its fund based and non fund based workingcapital requirements as tied up with Bank of Baroda and Standard Chartered Bank,respectively. During the year under review, the Company was comfortable in meeting itsfinancial requirements. Effective financial measures have been continued to reduce cost ofinterest and bank charges.
6. Management Discussion and Analysis:
The Management Discussion and Analysis Report is appended as Annexure-1 to this Report.
7. Corporate Governance:
A separate Section on Corporate Governance is included in the Annual Report and thecertificate from the Company’s Auditors confirming the compliances of conditions onCorporate Governance as stipulated in Clause 49 of the Listing Agreement with StockExchanges is annexed thereto, which forms part of the Director’s Report.
8. Directors:
Mr. O. P. Khanna and Mr. Rajesh Varma retire by rotation, and being eligible, offerthemselves for re-appointment.
9. Auditors:
The Auditors, M/s. Naresh and Co., Chartered Accountants, Vadodara retire at theconclusion of the forthcoming Annual General Meeting and being eligible have expressedtheir willingness to be re-appointed. The Company has received a Certificate from M/ s.Naresh and Company to the effect that their re-appointment, if made, will be within thelimit prescribed under Section 224(1B) of the Companies Act, 1956.
10. Auditor’s Report:
The Auditors, in their Report, have referred to the notes forming part of the accounts.The said notes are self-explanatory.
11. Fixed Deposits:
Your Company has not accepted any fixed deposits.
12. Energy, Technology and Foreign Exchange:
In accordance with the requirements of Section 217(1)(e) of the Companies Act, 1956,read with the Companies (Disclosure of Particulars in the Report of Board of Directors)Rules, 1988, particulars with respect to Conservation of Energy, Technology Absorption,Foreign Exchange Earnings and Outgo are given vide Annexure-2 and forms part of thisReport.
13. Particulars of Employees:
The statement of Particulars of Employees pursuant to Section 217 (2A) of the CompaniesAct, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, isnot applicable to the company.
14. Directors’ Responsibility Statement:
The Directors state that:
(i) in the preparation of the annual accounts for the financial year ended 2010-11, theapplicable accounting standards had been followed along with proper explanation relatingto material departures
(ii) 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 2010-11and of the profit or loss of the Company for that period ;
(iii) the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company for that period ;
(iv) the Directors had prepared the annual accounts on a going concern basis.
15. Compliance Certificate
The Company has obtained a compliance certificate as required u/s. 383A of theCompanies Act, 1956 which is attached herewith, forming part of this report.
16. Personnel / Industrial relations:
During the period under review, the personal and industrial relations with theemployees remained cordial in all respects.
17. Acknowledgement:
Your Directors wish to place on record their deep appreciation and thanks to all theBanks, Central and State Government and Local Authorities and all stakeholders for theircontinued co-operation in the progress of your Company.
Your Directors also wish to place on record their wholehearted thanks for the dedicatedservices rendered by the employees of the Company.
| For and on behalf of the Board of Directors |
| For SHILCHAR TECHNOLOGIES LIMITED |
| Place: Bil, Dist. Vadodara | JITENDRA C. SHAH |
| Date: 28.05.2011 | CHAIRMAN |