To the Members,
Your Directors have pleasure in presenting the 33rd Annual Report along with AuditedStatement of Accounts for the year ended 31st March, 2011.
Rs. in Crores
| ||2010-11 ||2009-10 |
|Net Turnover and other Income ||868.44 ||669.02 |
|Profit before Depreciation & Tax ||103.77 ||69.19 |
|Less: Depreciation ||20.93 ||20.19 |
|Profit before Tax ||82.84 ||49.00 |
|Less: Provision for Taxation || || |
|Current Tax ||26.60 ||15.00 |
|Deferred Tax ||(1.29) ||0.34 |
| ||25.31 ||15.34 |
|Profit after Tax ||57.53 ||33.66 |
|Add: Adjustments relating to earlier year ||0.11 ||0.06 |
| ||57.64 ||33.72 |
|Add: Surplus brought forward from previous year ||11.85 ||5.83 |
|Surplus available for appropriation ||69.49 ||39.55 |
|Less: Transfer to General Reserve ||10.00 ||21.12 |
|Proposed Dividend ||6.56 ||- |
|Interim Dividend ||- ||5.62 |
|Tax on Dividend ||1.07 ||0.96 |
| ||17.63 ||27.70 |
|Balance Carried Forward to Balance Sheet ||51.86 ||11.85 |
During the year under review, the total Income of your Company was Rs. 868.44 croresagainst Rs. 669.02 Crores in the previous year, registering a growth of 29.81%. The netprofit after tax was at Rs. 57.64 crores against Rs. 33.72 crores in the previous year,registering a growth of 70.94%.
The increase was due to all round growth in all the business verticals of yourCompany-Fabrics, Yarn, Dyeing, Readymade Garments and Furnishing. Improved capacityutilization and operating efficiency enabled your Company to post better results despiteof surging raw material prices and inflation rising to dizzy heights.
Your Company plans to increase the production capacity of fabrics & readymadegarment divisions by 20 lakh meters and 75000 pieces per month respectively. The envisagedcapital expenditure towards plant and machinery is around Rs. 150 crores. This will befinanced by way of Term Loan (under the TUF Scheme of Government of India) and internalaccruals of the Company and same will be incurred in a phased manner in the next 2 to 3years.
Your Directors are pleased to recommend a Dividend of Rs. 7/- per Equity Share (70%)for the year 2010-11, with a total payout of Rs. 7.62 crores including Tax on Dividend.
Management Discussion and Analysis:
The year under review presented a strong growth story for your Company. Sales grew 30%on year-on-year basis. Strong and buoyant demand, increasing purchasing power in the handsof younger population and overall structural and inclusive growth on the macro-economicfront acted as external impetus contributing to this growth. Innovative offeringsand efforts to leverage its strong distribution network were the internal factors thatenabled your Company to remain on the forefront in the dynamic fashion industry.
Economic front, however, put forth a rather mixed scenario. For developed economies,uncertainty about pace of global recovery, limited private spending, dependence on thefiscal and monetary stimuli and weaker rate of recoveries persisted throughout the year.Developing economies like India, in contrast, grew at much higher pace. But this growthhappened on the backdrop of increasing inflationary pressures, requiring Central Bank andpolicy makers juggle between tightening monetary policies and taking measures to supportgrowth.
Sustained growth story of the Indian economy promises to augur well for the businessesin general. Your Company is well-poised to explore opportunities which may arise due toall-round growth. Its strong expertise in core areas, strength of its well-positionedbrands, continued application of state-of-art technology, wider and deeper penetration inthe growing markets in tier II and tier III cities are the strengths which are expected toenable your Company to continue to move ahead on its growth trajectory.
But rising inflationary pressures, weak global recovery, volatility in raw materialprices, tighter fiscal and monetary policies and possibility of slower growth rate ofIndian economy are the key concerns on the macroeconomic fronts which may have an impacton your Companys operations in the ensuing year.
Your Company, however, is well-placed to mitigate the risks. Its strong presencein the domestic market, well-established brands and resilient distribution network, areexpected to stand tests of time. On the strengths of these, your Company, therefore,expects good growth in the ensuing year.
Forward Looking Statements
Statement in the Management Discussion and Analysis describing the Companysobjectives, projections, estimates, expectations or predictions may be forward lookingstatements within the meaning of applicable securities laws and regulations. Actualresults could differ materially from those expressed or implied. Important factors thatcould make a difference to the Companys operations include raw material availabilityand prices, cyclical demand and pricing in the Companys principal markets, changesin Government regulations, tax regimes, economic developments within India and thecountries in which the Company conducts business and other incidental factors.
Internal Control System:
Your Company has adequate system of internal controls to ensure that all the assets aresafeguarded and are productive. Necessary checks and controls are in place to ensure thattransactions are properly verified, adequately authorized, correctly recorded and properlyreported. The Internal Auditors of the Company conducts Audit of various departments toensure that internal controls are in place and submits monthly and yearly Reports to theAudit Committee. The Audit Committee regularly reviews these Reports and the Company whenneeded takes corrective actions.
Your Company treats its human resources as its important asset and believes in itscontribution to the all round growth of your Company. Your Company takes steps, from timeto time, to upgrade and enhance the quality of this assets and strives to maintain it inagile and responsive form. Your Company is an equal opportunity employer and practicesfair employment policies. Your Company is confident that its Human Capital willeffectively contribute to the long term value enhancement of the organization.
The Company has no subsidiaries.
Shri Arvind M. Poddar, Shri Shrikishan D. Poddar, Smt. Vijaylaxmi A. Poddar and ShriDileep H. Shinde, Directors, retire by rotation and being eligible offer themselves forre-appointment. Necessary resolutions for their re-appointment are placed before theshareholders for approval. Your Directors commend the resolutions.
Shri. Harish N. Motiwalla was appointed as Additional Director of the Company w.e.f.21st May, 2011 and holds office till the date of ensuing Annual General Meeting. Noticeunder section 257 of the Companies Act, has been received from a member proposing him asDirector of the Company. Necessary resolution has been put up in the Notice of the ensuingAnnual General Meeting for approval of the membe Your Directors commend the resolution.
The Board has approved the re-appointment of Shri. Pawan D. Poddar as Joint ManagingDirector for a further period of five years from 1st August, 2011 to 31st July, 2016.Necessary resolution has been put up in the Notice of the ensuing Annual General Meetingfor approval of the membe Your Directors commend the resolution.
Brief resume of Directors being appointed/ re-appointed as required by Clause 49 of thelisting agreement is provided in the notice convening the Annual General Meeting of theCompany.
A report on Corporate Governance as stipulated under clause 49 of the Listing Agreementwith the Stock Exchange(s) forms part of the Annual Report.
Certificate compliance of conditions of Corporate Governance as stipulated under theaforesaid clause 49 forms part of the Annual Report.
There were no unclaimed deposits as on 31st March, 2011.
Directors Responsibility Statement:
As stipulated under Section 217 (2AA) of the Companies Act, 1956, your Directorsconfirm as under:-
i) that in the preparation of the accounts for the financial year ended 31st March2011, the applicable accounting standards have been followed along with proper explanationrelating to material departures;
ii) that the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for the year under review;
iii) that the Directors have taken proper and sufficient care for maintenance ofadequate accounting records in accordance with the provisions of the Companies Act, 1956for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
iv) that the Directors have prepared the accounts for the financial year on goingconcern basis.
Industrial relations with staff and workmen during the year under review continued tobe cordial.
Particulars of Employees:
In accordance with the provisions of Section 217 (2A) of the Companies Act, 1956 andthe rules framed thereunder, the names and other particulars of employees are set out inthe Annexure to the Directors Report. In terms of the provisions of Section 219(1)(b) (iv) of the Companies Act, 1956, the Directors Report is being sent to all theshareholders of the Company excluding the aforesaid Annexure. The Annexure is availablefor inspection at the Corporate Office of the Company. Any shareholder interested inobtaining a copy of the said Annexure may write to the Company Secretary at the CorporateOffice of the Company.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:
Information pursuant to Section 217 (1) (e) of the Companies Act, 1956, read with theCompanies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988is given in Annexure I to this report.
The Auditors, M/s.Jayantilal Thakkar & Co., Chartered Accountants, Mumbai, retireat the conclusion of ensuing Annual General Meeting and are eligible for re-appointment.Members are requested to re-appoint them as fixtheir Auditors and to remuneration.
Pursuant to the directives of the Central Government under the provisions of Section233 B of the Companies Act, 1956, M/s. Tholiya & Associates, Cost Accountants, Mumbaihave been appointed to conduct cost audit relating to the products manufactured by theCompany.
As required under Regulation 3(1)(e)(i) of the Securities and Exchange Board of India(Substantial Acquisition of Shares and Takeovers) Regulations, 1997, persons constituting"Group" (within the meaning as defined in the Monopolies and Restrictive TradePractices Act, 1969) for the purposes of availing exemption from the applicability of theprovisions of Regulations 10 to 12 of the aforesaid SEBI Regulations are given in AnnexureII attached herewith and forms part of this Report.
Your Company is grateful for the continued co-operation and support extended to it bythe Government and Semi-Government Authorities, Shareholders, Financial Institutions andBanks. Your Directors also express their warm appreciation for the dedicated and sincereservices rendered by the Employees of the Company.
| ||For and on behalf of the Board of Directors |
| ||DHARAPRASAD R. PODDAR |
| ||Chairman |
|Place: Mumbai || |
|Dated: 21st May, 2011. || |
ANNEXURE - I
Additional Information as required under the Companies (Disclosure of particulars inthe Report of the Board of Directors) Rules, 1988.
A) CONSERVATION OF ENERGY
a) Energy conservation measures taken by the Company
(i) Electrical Energy:
(a) Reducing the maximum demand by evenly distributing the loads throughout the day andincreasing efficiency of plant and equipments.
(b) Improving power factor by optimum choice of power factor improvements capacitors.
(c) Monitoring the overall energy consumption, by reducing losses and improvement ofefficiency of all Class A utilities.
(ii) Fuel Oil Consumption:
The Company is carrying out at all its plants, regular maintenance of steam lines/stemtraps and user equipments to ensure high efficiency levels throughout the year. The newimprovements are reviewed regularly and implemented wherever found suitable.
b) Additional Investments and proposals, if any, being implemented for reduction ofconsumption of energy: The Company is reviewing various proposals for reduction inconsumption of energy, mainly by way of replacement of existing equipments by modern andenergy efficient equipments.
c) Impact of the measures (a) and (b) above for reduction of energy consumption andconsequent impact on cost of production of goods: As per Form "A".
d) Total energy consumption per unit of production: As per Form "A".
|Particulars ||Total for 10-11 ||Total for 09-10 |
|A. Power & Fuel Consumption || || |
|1 Electricity || || |
|a) Purchased (units) ||26988739 ||22815869 |
|Total Amount (Rs. ) ||105634274 ||91425743 |
|Rate / unit ||3.91 ||4.01 |
|b) Own generation || || |
|From Diesel Generators (units) ||894592 ||1262329 |
|Diesel oil consumption (Ltrs ) ||268108 ||375474 |
|Units per ltr of Diesel oil ||3.34 ||3.36 |
|Cost / unit (Rs. ) ||12.67 ||9.09 |
|2 Coal / Pet Coke || || |
|Quantity (Kgs) ||1323955 ||1085528 |
|Total Cost (Rs. ) ||11449989 ||7247838 |
|Average rate per tonne ||8648 ||6677 |
|3 Furnace Oil / L.S.H.S. || || |
|Quantity in Ltrs ||180697 ||192260 |
|Total Cost (Rs. ) ||7092589 ||5239320 |
|Average rate ( in '000 ltrs) ||39251 ||27251 |
|Total Value ||135507190 ||115391029 |
|B. Consumption per unit of Production || || |
|1 Electricity ( KWH) || || |
|Cloth / Mtr ||0.72 ||0.76 |
|Yarn / kg ||1.94 ||1.71 |
|Garment / Nos. ||0.50 ||0.42 |
|2 Furnace Oil / L.S.H.S || || |
|Dyed Yarn / Kg ||- ||- |
|Garments / Nos. ||0.07 ||0.06 |
|3 Coal & Fuel Wood || || |
|Dyed Yarn/Kg ||0.39 ||0.36 |
|Garment Nos ||- ||- |
Note: - The Company manufactures a wide range of products and the consumption of Energywill vary significantly depending upon the actual product-mix
B) TECHNOLOGY ABSORPTION:
Efforts made in technology absorption as per Form "B"
I. Research and Development (R& D):
1. Specific Areas in which R & D carried out by the Company:
Product and quality Improvement, development of new designs, products, cost control andenergy conservation.
2. Benefits derived as a result of the above R & D:
The R & D activities have resulted into development of new designs and Products.
3. Future plan of Action: Development of new varieties and Product mix.
4. Expenditure on R & D.
|Capital || Rs. Nil- |
|Recurring || Rs. 216.28 Lacs |
|Total || Rs. 216.28 Lacs |
II. Technology absorption, adoption and innovation:-
1. The Company has been developing in-house modifications/improvements in processtechnology in its various manufacturing sections which, when found suitable, areintegrated into the regular manufacturing operation.
2. Benefits derived as a result of the above efforts:
(a) Quality improvement
(b) Energy Conservation
3. In case of imported technology (imported during the last 5 years reckoned from thebeginning of the financial year) following information may be furnished: Not Applicable.
C) FOREIGN EXCHANGE EARNINGS AND OUTGO:
a) Activities relating to exports, initiatives taken to increase exports, developmentof new export markets for products and services and export plans:
The Company is continuously making efforts to export its products throughout the World.The Companys products have been well accepted in the international markets and theCompany is confident that the sales turnover will gradually improve in the coming yea
b) Total Foreign Exchange Used and Earned (Rs. in lacs)
|Used - Rs. 1246.96 ||Earned Rs. 4107.17 |
| ||For and on behalf of Board of Directors |
| ||Dharaprasad R. Poddar |
|Place: Mumbai ||Chairman |
|Date: 21st May, 2011. || |
For The Kind Attention of the Members
The Ministry of Corporate Affairs has taken a "Green Initiative in the CorporateGovernance" by allowing paperless compliances by the Companies and has issuedcirculars stating the service of notice/documents including Annual Report can be sent bye-mail to its membe To support this green initiative of the Government in full measure,members who have not registered their e-mail addresses, so far, are requested to registertheir e-mail addresses, in respect of electronic holdings with the Depository throughtheir concerned Depository Participants. Members who hold shares in physical form arerequested to register their email address by sending their details to the Registrar andShare Transfer Agents, M/s. TSR Darashaw Ltd.
ANNEXURE - II
The following is the list of persons constituting "Group" (within the meaningas defined in the Monopolies and Restrictive Trade Practices Act, 1969) for the purposesof availing exemption from the applicability of the provisions of Regulations 10 to 12 ofthe Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations, 1997 ("the said Regulations"), as provided in Clause3(1)(e)(i) of the said Regulations:
1 S.P.Finance & Trading Ltd.
2 Balgopal Holdings & Traders Ltd.
3 Vishal Furnishings Ltd.
4 Poddar Brothers Investment Pvt. Ltd.
5 Sanchna Trading & Finance Ltd.
6 SP Investrade (India) Ltd.
7 SPG Realty Pvt. Ltd.
8 Poddar Bio Diesel Pvt. Ltd.
9 Oxemberg Clothing Pvt. Ltd.
10 Siyaram Polycote Pvt. Ltd.
11 Oxemberg Fashions Ltd.
12 Beetee Textiles Industries Ltd.
13 Santigo Textiles Mills Ltd.
14 Balkrishna Paper Mills Ltd.
15 Balkrishna Synthetics Ltd.
16 BKT Moulds Ltd.
17 BKT Tyres Ltd.
18 BKT (EXIM) Ltd.
19 SPG Power Ltd.
20 SPG Infrastructure Ltd.
21 Futurisctic Concept Media Ltd.
22 Seeom Fabrics Ltd.
23 Image Commercials Pvt. Ltd.
24 Paramount Minerals & Chemical Ltd.
25 GRL International Ltd.
26 Govind Rubber Ltd.
27 Balkrishna Industries Ltd.
28 Trendline Commercials Pvt. Ltd.
29 Wavelink Commercials Pvt. Ltd.
30 DPP Trading Pvt. Ltd.
31 MPP Trading Pvt. Ltd.
1 Shri Dharaprasad Ramrikhdas Poddar
2 Smt Geetadevi Dharaprasad Poddar
3 Shri Rameshkumar Dharaprasad Poddar
4 Smt Ashadevi Rameshkumar Poddar
5 Shri Pawankumar Dharaprasad Poddar
6 Smt Madhudevi Pawankumar Poddar
7 Shri Avnish Pawankumar Poddar
8 Smt Vithika Avnish Poddar
9 Mst Agastya Avnish Poddar
10 Shri Anurag Pawankumar Poddar
11 Smt Megha Anurag Poddar
12 Smt Sangeeta Pramodkumar Poddar
13 Shri Gaurav Pramodkumar Poddar
14 Smt Smriti Gaurav Poddar
15 Shri Ankit Pramodkumar Poddar
16 Shri Shrikishan Dharaprasad Poddar
17 Smt Vibha Shrikishan Poddar
18 Shri Abhishek Shrikishan Poddar
19 Shri Harshit Shrikishan Poddar
20 Smt Anuja Mundra
21 Smt Shivani Tiberwala
22 Smt Tribenidevi Mahabirprasad Poddar
23 Smt Shyamlata Sureshkumar Poddar
24 Shri Rishabh Sureshkumar Poddar
25 Shri Arvindkumar Mahabirprasad Poddar
26 Smt Vijaylaxmi Arvindkumar Poddar
27 Shri Rajiv Arvindkumar Poddar
28 Smt Khushboo Rajiv Poddar
29 Shri Vinodkumar Mahabirprasad Poddar
30 Smt Sunita Vinodkumar Poddar
31 Shri Rahul Vinodkumar Poddar
32 Smt Shefali Rahul Poddar
33 Ms Rishita Vinodkumar Poddar
34 Smt Aarti Shorewala
35 Smt Aanchal Deora
36 Smt Shikha Kandoi
37 Smt Pooja Dhoot
38 Smt Vihari Abhishek Poddar
C Partnership Firms
1 Fabwear Garments
2 Tirupati Realty
3 Balaji Realty
4 Shree Siyaram Textiles
1 Dharaprasad & Sons HUF
2 Dharaprasad Poddar & Co. HUF
3 Rameshkumar Poddar & Brothers HUF
4 Rameshkumar Poddar & Co.HUF
5 Pawankumar Poddar & Co.HUF
6 Pramod Poddar HUF
7 Dharaprasad Pramodkumar HUF
8 Shrikishan Poddar HUF
9 Mahabirprasad Poddar & Co.HUF
10 Arvindkumar Sureshkumar Poddar HUF
11 Sureshkumar Poddar & Co.HUF
12 Mahabirprasad & Sons HUF
13 Sureshkumar Poddar & Brothers HUF
14 Arvind Poddar HUF
15 Mahabirprasad Vinodkumar HUF
16 Vinod Poddar HUF
E Limited Liability Partnership
1 DPP Enterprises LLP
2 GPP Enterprises LLP
3 PKP Enterprises LLP
4 HSP Enterprises LLP
5 TMP Enterprises LLP
6 AKP Enterprises LLP
7 RAP Enterprises LLP
8 VKP Enterprises LLP