SHILPI CABLE TECHNOLOGIES LIMITED
ANNUAL REPORT 2011-2012
Your Directors have pleasure in presenting the Sixth Annual Report of your
Company together with the Audited Annual Accounts for the financial year
ended 31st March, 2012.
(Amount in Rs. Lacs)
Particulars Financial Year ended
31st March, 2012 31st March, 2011
Net Sales 46,054.89 23,039.77
Other Income 265.97 147.10
Increase/(Decrease) in Stocks 1660.09 172.33
Total Income 46,320.86 23,200.95
Total Expenditure 43,543.88 21,203.92
Profit before tax 2,776.98 1,997.03
Provision for tax 914.57 661.45
Profit after tax 1,862.41 1,335.58
Transfer to Reserve 3,640.53 2,127.70
Paid-up Share Capital 3,229.88 2,420.00
Reserves and Surplus
(excluding revaluation reserve) 9967.55 3,067.69
Year in Retrospect:
During the year under review, total income of the Company was Rs. 46,320.86
lacs as against Rs. 23,200.95 lacs in the previous year. The Company was
able to earn a profit after tax of Rs. 1,862.41 lacs for the year as
against a profit of Rs. 1,335.58 lacs in previous year. The figures of the
previous year was not comparable with the current year as current year
figures includes the figures of erstwhile Transferor Company-Shipli
Cabletronics Ltd which is merged with the Company w.e.f. the appointed date
i.e. 1st April, 2011 in terms of the Scheme of Amalgamation approved by the
Hon'ble Delhi High Court vide order dated 14th May, 2012. Your Directors
are putting in their best efforts to improve the performance of the
The detailed Management Discussion & Analysis Report is attached hereto
with the Director's Report and should be read as part of this Directors
Material Changes after the close of the financial year:
The Scheme of Amalgamation of Shilpi Cabletronics Ltd with Shilpi Cable
Technologies Ltd was approved by the Hon'ble Delhi High Court, vide order
dated 14th May 2012. The Scheme has become effective w.e.f. 1st June, 2012
the date of filing of order with the Registrar of Companies, Delhi. Since
the scheme is operative from the appointed date 1st April 2011 the effect
of amalgamation has been given in the present Audited Annual Accounts.
In terms of the Scheme of Amalgamation the company has allotted 52,17,374
equity shares of Rs 10/- each on 2nd June 2012 to SCTL Securities Trust to
hold the same in the beneficial interest of Shilpi Cable Technologies Ltd.
Save as mentioned elsewhere in this Report, no material changes and
commitments affecting the financial position of the Company has occurred
between the end of the financial year of the Company 31st March, 2012.
The Board of Directors of your Company has decided to retain and plough
back the profits into the business of the Company, thus no dividend is
being recommended for this year.
Your Company believes that the great organizations are built on the
foundation of good governance practices. Corporate governance is all about
effective management of relationship among constituents of the system, i.e.
shareholders, management, employees, customers, vendors, regulatory and the
community at large.
As stipulated under Clause-49 of the listing agreement, the Management
Discussion and Analysis Report and the Corporate Governance Report had been
incorporated as Separate Section forming part of the Annual Report.
The compliance report on Corporate Governance and a certificate from M/s
R&D Company Secretaries regarding compliance of the conditions of Corporate
Governance, as stipulated under Clause 49 of the Listing Agreement with the
Stock Exchanges,is attached here with and forms part of this Annual Report.
Certificate from Managing Director and Chief Financial Officer,inter alia,
confirming the correctness of the financial statements, compliance with
Company's Code of Conduct, adequacy of the Internal Control measures and
reporting of matters to the Audit Committee in terms of Clause 49 of the
Listing Agreement with the Stock Exchanges, is also enclosed as a part of
the Annual Report.
During the year under review, your Company has acquired 100% of the
total,issued and subscribed and paid up capital of Shilpi Worldwide JLT,
UAE and there by, Shilpi Worldwide JLT is a Wholly Owned Subsidiary.
The erstwhile Wholly Owned Subsidiary of the Company - M/s Shilpi
Cabletronics Ltd. has been amalgamated with the Co m pa ny w.e.f. 1st June,
During the year under report,your Company did not accept any deposits from
the public in terms of the provisions of section 58A of the Companies Act,
Conservation of Energy,Technology Absorption, Foreign Exchange Earnings and
a. Conservation of Energy & Technology Absorption: The company endeavor to
achieve optimum conservation of energy. The electrical systems on all
machines are equipped with latest energy efficient control systems to
ensure optimum power utilization. Information as required under section
217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of Board of Director) Rules, 1988, regarding
conservation of energy, technology absorption and foreign exchange earnings
& outgo, is given in Annexure-A, forming part of this report.
b. Export Activities: There was no export activity in the Company during
the year under review. Your Company may explore to enter into the
international market in future.
c. Foreign Exchange Earnings and Outgo:
(Amount in Rs Lacs)
Total Foreign Exchange Inflow Nil Nil
Total Foreign Exchange outflow 21,105.67 1,3550.70
Particulars of Employees:
During the financial year under review, none of the employees of the
Company was in receipt of remuneration as prescribed under section 217(2A)
of the Companies Act, 1956, read with the Companies (Particulars of
Employees) Rules, 1975 as amended.
Except for the following changes, there was no change in the composition of
the Board of Directors of the Company subsequent to the last Directors'
Mr. Anirudh Goel and Mr. Rajesh Suri have resigned from the Board of
Directors w.e.f 15th September, 2011 and 10th September, 2011,
Mr. Ghanshyam Pandey has resigned from the office of Whole-time Director of
the Company w.e.f 31st May,2012. However, he is continuing as a non-
In accordance with the provisions of the Act and Articles of Association of
the Company, Mr. Manish Goel and Mr. Sunil Kala, Directors of the
Company,are liable to retire by rotation and being eligible,offer
themselves for re-appointment.
The brief resumes of the Directors who are to be re-appointed,the nature of
their expertise in specific functional areas,names of companies in which
they have held directorships, committee memberships/chairmanships, their
shareholding, etc. are furnished in the Corporate Governance Report.
The Board recommends their re-appointment at the ensuing Annual General
M/s RMA & Associates, Chartered Accountants, Statutory Auditors of the
Company hold office until the conclusion of the ensuing Annual General
Meeting and being eligible, offer themselves for re-appointment. A
certificate under section 224(1) of the Companies Act, 1956 regarding their
eligibility for the proposed re-appointment has been obtained from them.
Your Directors recommend their re-appointment.
Comments made by the Statutory Auditors in the Auditors' Report are self-
explanatory and do not require any further clarification.
Directors' Responsibility Statement:
In terms of the provisions of section 217(2AA) of the Companies Act, 1956,
and to the best of their knowledge and belief and according to the
information and explanations obtained by them and save as mentioned
elsewhere in this Report, the attached Annual Accounts and the Auditors'
Report thereon, your Directors confirm that:
a. In preparation of the annual accounts,the applicable accounting
standards have been followed;
b. The Directors have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of the
Company as at 31st March, 2012 and of the profit of the Company for the
year ended on that date;
c. The Directors have taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of the Act
for safeguarding the assets of the Company and for preventing and detecting
fraud and other irregularities; and
d. The Directors have prepared the Annual Accounts on a going concern
Stock Exchange Listing:
The shares of the Company are listed on the BSE Ltd. and National Stock
Exchange of India Ltd. (NSE) The listing fee for the financial year 2012-13
has already been paid to both the Stock Exchanges.
Your Directors take this opportunity to place on record their sincere
appreciation for the co-operation and assistance the Company has received
from Banks and various Government Departments. The Board also places on
record its appreciation of the devoted services of the employees, support
and co-operation extended by the valued business associates and the
continuous patronage of the customers of the Company.
For and on Behalf of the Board
For Shilpi Cable Technologies Ltd.
Date : 14th August, 2012 Manish Goel Ghanshyam Pandey
Place: New Delhi Whole-time Director Director
DIN No. 00163105 DIN No. 00163072
Annexure - A
Annexure to the Directors' Report:
INFORMATION AS PER SECTION 217(1)(e) READ WITH COMPANIES DISCLOSURE OF
PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988 AND FORMING
PART OF THE DIRECTORS' REPORT FOR THE YEAR ENDED 31st MARCH, 2012.
PARTICULARS AS PER FORM A:
A. POWER AND FUEL CONSUMPTION
Units (in lacs) 17.65 10.21
Total amount (in lacs) 98.07 50.79
Rate/Units (in Rs.) 5.56 4.97
(b) OWN GENERATION:
(I) Through Diesel Generator
Units (in lacs) 1.83 1.82
Total amount (in lacs) 22.78 23.41
Rate/Unit (in Rs.) 12.43 12.86
(ii) Through Steam Turbine/Generator NIL NIL
2. LIGHT DIESEL OIL/FURNILCE OIL
Quantity (Kilo Ltrs.) NIL NIL
Total Cost (in lacs) NIL NIL
Average/Ltrs (in Rs.) NIL NIL
a. LPG GAS
Quantity (K.G.) NIL NIL
Total Cost (in lacs) NIL NIL
Average/K.G. (in Rs.) NIL NIL
b. NATURAL GAS
Quantity (SCM) NIL NIL
Total Cost (in lacs) NIL NIL
Average/SCM (in Rs.) NIL NIL
PARTICULARS AS PER FORM-B:
A. RESEARCH AND DEVELOPMENT (R&D):
(a) Specified Areas in which R&D
carried out by the Company: NIL NIL
(b) Benefits derived as a
result of the above R&D: NIL NIL
(c) Future plan of action NIL NIL
(d) Expenditure on R&D
(i) Capital NIL NIL
(ii) Recurring NIL NIL
(iii) Total NIL NIL
(iv) Total R&D Expenditure as a
percentage of total turnover NIL NIL
B. TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION:
(a) Efforts in brief, made towards Technology
Absorption, Adaption and innovation: NIL NIL
(b) Benefits derived as a result of the above
efforts e.g., product improvement, cost
reduction, product development, import
substitution etc.,: NIL NIL
(c) In case of imported technology,
(imported during the last five years
reckoned from the beginning of the
(financial year) following information
may be furnished:
i) Technology imported NIL NIL
ii) Year of import NIL NIL
iii) Has technology been fully absorbed NIL NIL
iv) If not fully absorbed, areas where
this has not taken place, reason thereof
and future plan of action NIL NIL
C. FOREIGN EXCHANGE EARNINGS AND OUTGO:
(a) Activities relating to exports,
initiative taken to increase exports,
development of new export markets for
products and services and export plans NIL NIL
(b) Total foreign exchange used (Rs. lacs) 21105.67 13550.70
(c) Total foreign exchange earned NIL NIL
MANAGEMENT DISCUSSION AND ANALYSIS
Statements in the Management Discussion and Analysis describing the
Company's objectives, expectations or predictions may be forward looking
within the meaning of applicable securities, laws and regulations. Actual
results may differ materially from those expressed in the statement.
Important factors that could influence the Company's operations include
overall global economic conditions, domestic manufacturing and service
sector growth, foreign exchange stability, stable credit environment,
Government policies, economic development, political factors and such other
factors beyond the control of the Company.
The company is engaged in the business of the manufacturing Cables of
various sizes for the Telecom Sector and the company also trades in cable
During the previous year the Company had acquired 100% shareholding of its
erstwhile subsidiary - M/s Shilpi Cabletronics Ltd. Thereafter Shilpi
Cabletronics Ltd has now been merged with the Company with the approval of
the High Court along with its business and manufacturing plant at Bhwadi,
Accordingly, apart from manufacturing and trading of telecom cables from
its Chopaki Plant at Rajasthan; the Company is now engaged manufacturing
and trading of automobiles, telecom and other cables and accessories from
its Bhiwadi Plant.
Despite the worldwide economic challenges,your Company remained steadfast
in delivering excellent performance during last financial year. Your Board
hopes that with the support from the Telecom & Automotive market, your
Company will accelerate the process to forge ahead towards the goal of
being a top-class company in this sector.
Industry Structure, Developments & Outlook:
The Indian cable market has been witnessing growth owing to the increasing
subscriber base. With over 900 million users, the Indian telecom market is
the second largest in the world. An expanding subscriber base and broad
band growth have led to telecom operators adopting new technologies to
increase the capacity of existing networks and offer improved quality of
Active infrastructure in a telecom network comprises components such as
radio frequency (RF) feeder cables, base transceiver stations (BTSs),
switches and antennas. RF feeder cables are used for connecting BTSs to
antennas, and given the large number of BTSs deployed in the country; there
exists a large market for this component.
As far as telecom cable sector is concerned;the key components that will
drive the demand of feeder cables in India in future are:
* Strong subscriber base and healthy growth estimates based on expansion of
mobile telephony in rural India;
* Demand for cell sites is expected to increase with each operator vying
for geographical expansion of their network; Mobile Number Portability
* 3G services
* Replacement of existing cables
Sharing of active infrastructure will also allow operators to share key
electronic components such as antennae, radio access networks, transmission
system and backhaul. Globally, sharing of active infrastructure elements
has been in commercial operation by 2G and 3G players.
Opportunities & Threats:
Opportunities in the Indian market: In India we have been focusing on the
increasing distribution network and product basket. With large population,
increasing urbanization and disposable income, the industry in which we
operate provide sustainable growth on a longerterm basis.
Opportunities in the international market: Robust growth of emerging
economies provides large opportunities to the company. We are a well
established Company in these economies and will continue to focus on the
growth, new product launches and increasing distribution strength. In other
mature economies, the market trend is changing favorably. The strategy of
the company is to get higher profitability and stable cash flow generations
in these markets.
Slow down: A slowdown of the World Economy mainly European economy is quite
possible for the short term due to current global developments. Due to the
strong linkage of the manufacturing industry to the economy, such an event
would adversely impact growth in the short term for the Company.
Competition: Competition whether domestic or international has always been
taken as a challenge. Transforming challenges into opportunities has been a
practice at our company.
Foreign Exchange: The business includes foreign currency risk due to
outsourcing from low cost countries and selling in other geographies. As it
has been the market practice followed by other major competitors and all
companies working on a global platform,the market absorption of the change
Risk Management & Internal Control system:
The Company is exposed to a variety of risks across its entire range of
business operations. To ensure its long-term success, risks are regularly
identified, analysed and appropriately mitigated. The company's products
are used primarily by the power utilities, infrastructure, real
estate,automobile and industrial segment. Any slowdown in these sectors can
largely impact the demand for the company's products.
The Company is also exposed to changes in foreign exchange rates and
commodity prices across its various business segments. Further, the Company
also has exposures to other foreign currency denominated assets and
liabilities. In many cases, such exposures are partly off-set by suitable
pass-through clauses built into contracts with customers.
The Company's Internal Control Process has been designed to achieve its
objectives to permissible limits through the effective function and
combination of its basic elements.
The company places due importance on its human capital assets and invests
in building and nurturing a strong talented pool to gain strategic edge and
achieve operational excellence in all its goals. As a part of ongoing HR
initiatives, skill mapping and matching is carried out; assessment of
training and development is also carried out at the time of performance
appraisals. Adequate training, mentoring programmes are designed to bridge
gaps, if any. Clear objectives and goals are determined to bring
objectivity to performance and overall goal achievement. During the year,
industrial relations continued to be cordial, with a strong spirit of
bonhomie and camaraderie prevailing among the rank and file of employees.
Product wise Performance:
The company sold cables wire and accessories of Rs 46028.81 Lacs during
financial year 2011-12.