MANAGEMENT DISCUSSION AND ANALYSIS REPORT
OVERALL REVIEW, INDUSTRY OUTLOOK & COMPANY'S OUTLOOK
During the year under review, Company's gross turnover increased by 21.85% overthe previous year. The net profit for the year is Rs.305.00 Lacs as compared to net profitof Rs.214.00 Lacs earned in previous year hence the net profit after tax has increased by42.52%. The increase in turnover is the extra efforts of the employees of thecompany and increasing goodwill in the International Market.
We are in the opinion that the demand for company's products would remain good in thecurrent year in view of good industrial demand in both domestic and export markets. Yourcompany is pursuing cost cutting measures and focusing on increased productivity,better product mix and thrust on sales and better price realization.
OPPORTUNITIES, THREATS AND CHALLENGES
The turnover has shown a reasonable growth and the trend is expected to continue. The companyhas great opportunity to further strengthen its presence in both domestic andinternational markets and achieve higher sales
The increased competition in the global and overall reces.sion in the global market aswell as domestic market especially in automobile sector is the main challenge to thacompany.
Company is quite competent to handle the competition successfully and gearing upitself to meet the challenge through continuous improvement in quality, reduction incosts, better marketing arrangements for higher value added products.
INTERNAL CONTROL SYSTEM AND ADEQUACY
The company has adequate internal control system to ensure operational efficiency,protection and conservation of resources, accuracy and promptness in financial reportingand compliance of laws and regulations. Your company is committed to maintain internalcontrol systems and procedures designed to provide reasonable assurance for orderlyand efficient conduct of business and security of its assets.
HUMAN RESOURCES / INDUSTRIAL RELATIONS
Training and development, safety and security and good relationship with humanresources is of paramount importance. A competent, committed and experienced HRD team hasmade the workforce more efficient through well-structurec training programme. Industrialrelations remain cordial during the year.
Statement in this Report, particularly those which relate tc Management Discussion andAnalysis, describing the Company's objectives, protections, estimates and expectations mayconstitute "forward looking statement" w thin the meaning of applicablelaws and regulations. Actual results might differ materially from those either.
ANNEXURE - A TO THE DIRECTORS' REPORT
A CONSERVATION OF ENERGY
Energy (conservation is an ongoing process in our organization. Continuous monitoring,planning, development and modifications for energy conservation are done at the plantsThe; various measures have contributed to maintain energy cost within the desired levels.
|(A) Conservation of Energy || |
|1 Electricity || || |
|(a) Purchased: || || |
|Unit (Kwh) || |
|Amount || |
|Rate/Unit (Rs.) || |
|(b) Own Generation : || || |
|Through Diesel Generator: || || |
|Unit (Kwh) || |
|Unit Produced per Itr of Diesel oil || |
|Cost / Unit (Direct Cost) (Rs.) || |
|2. Fuel in oil fired Annealing Furnaces : || || |
|Quantity (Ltrs) || |
|Total Cost (Rs.) || |
|Rate /unit (Rs. /PMT) || |
|B Consumption per unit of Flat Rolled Production || || |
|Electricity (kwh/ PMT) || |
|Fuel (Ltr/PMT) || |
|Other detail || || |
|HSD Cons. In D.G Sets (Ltr) || |
|HSD Cons. In D.G Sets (Rs.) || |
|Production CRCA || |
|Production H & T || |
|Total Packed Production || |
Consumption figures are not strictly comparable as Company produces wide varities ofstrips and consurr ption norms change according to thickness / width of strips as well asgrade of material produced.
C TECHNOLOGY ABSORPTION
a) Research and Development (R & D)
The company has no specific Research & Development Department. However it hasQuality Assurance Department to check the quality of different products manufactured.
The company has been continuously improving the quality of the existing products andalso been able to reduce the cost of production.
Management is committed to strengthen Quality Assurance Department, further to improveits competitiveness in times to come.
b) Expenditure on R & D
The company from time to time incurs expenditure, exposes itself to better technologyand keeps abreast of technological improvements.
c) Technology Absorption, Adoption and Innovation
Modifications of process and products are carred out from time to time to suit marketrequirements and to improve operational efficiency.
The Company has no technical collaboration arrangement for manufacturing of flat RolledProducts and Circular Saws.
D FOREIGN EXCHANGE EARNINGS AND OUTGO
| || |
|Foreign Exchange earned || |
|Foreign Exchange used || |
CORPORATE GOVERNANCE REPORT FOR THE YEAR 2010-2011
1. Company's Philosophy on Corporate Governance.
The Company's Philosophy on Corporate Governance is to ensure transparency in alldealings and maintain highest standards of professionalism, integrity, accountability,social responsibility, fairness and business ethics. We consider ourselves as trustees ofthe shareholders and relentlessly attempt to maximize long-term shareholder value.
Your Directors confirm the practice of good corporate Governance codes by the Companyin true spirit and are pleased to present below the Report on Corporate Governance.
2. Eloard of Directors
The present strength of the Board is four, comprising of one Executive Chairman &Managing Director, and 2 Non-executive Directors (All are independent). The strength ofthe incependent director is 75% of the total Board members leading to an"Independent" Board characteristic. None of the independent director is belowthe age of 21 years.
None of the Directors on the Board is a member of mere than 10 committees and Chairmanof more than 5 committees, which is in compliance of Clause 49(1 )(d) of the ListingAgreement.
During the year, four - Board Meetings were held on 29.05.2010, 14.08.2010,9.11.2010 and 12.02.2011.
Composition of Directors and the attendance at the Board Meeting during the year andthe last AGM as also other directorships and Committee Memberships are given below:
| || || || || |
|Name of Director ||Category of Directorship || |
No. of Board meetings Attended
Whether Attendance at last AGM
|Mr.Sudhir Khaitan ||Promoter & Executive Director || |
|Mr. Shiv S. Sharma ||Independent Director || |
|Mr.V.B.L. Mathur ||Independent Director || |
|Lt. Col. Purshottem Lt Bawa ||Independent Director || |
The Company places before the Board, all the relevar t and necessaryinformation for seeking the necessary consents and suggestions on the operation and plansof the Compan/.
The Information as required under Annexure 1 of Clause 49 of the ListingAgreement is being made available to the Board.
The details of pecuniary relationship / transactions with Non-executiveDirectors during the year is given in the Annual Report
3. Board Committee's
Your Company's Board has three Committees
Shares Transfer Cum-lnvestors Grievance Committee
A. Audit Committee :
The Board of the company has constituted an Audit Committee on 29th June2002.
"he Committee met on 29.05.2010, 14.08.2010, 09.11.2010 and 12.02.2011 during theyear.
The constitution of the Audit Committee and the details of the attendance are as under.
|Name of the Directors || |
No. of Meetings Held
No. of Meetings Attended
Whether Last AGM attended
|Mr. Shiv S. Sharma || |
Non-Executive & Independent
|Mr. V.B.L. Mathur || |
|Lt. Col. Purshottem Lai Bawa || |
The Quorum is two Members present in person.
The Secretary of the Company acts as the Secretary of the Committee. The Finance Headand the Chief Internal Auditor are permanent invitees. Temis of Reference:
The role of the audit committee shall include the following: -
a Review of the Company's financial reporting process and the disclosure of adequateand accurate financial information to ensure that the financial statement is correct,sufficient and credible.
b Recommending the appointment of statutory auditor, fixation of audit fees and alsoapproval for payment any other services.
c Reviewing the annual financial statements in consultation with the management beforesubmission to the board, focusing primarily on:
i. Matters required to be included in the Director's Responsibility Statement whichforms a part of the
Director's Report pursuant to Subsection (2AA) of Section 217 of the Companies Act,1956. ii. Charges, if any, in accounting policies and practices and reasons for the sameiii. Major accounting entries involving estimates tased on the exercise of judgement bymanagement
iv. Significant adjustments made in the financial statements arising out of auditfindings
v. Comoliance with listing and other legal requirements relating to financialstatements
vi. Disclosure of any related party transactions
vii. Qualifications in the draft audit report
d) Reviewing the adequacy of internal control systems with the management, external andinternal auditors.
e) Reviewing the adequacy of internal audit function, including the structure of theinternal control systems.
f) Discussion with internal auditors on any significant findings and follow up thereon.
c) Reviewing the findings of any internal investigations by the internal auditors intomatters where there is suspected fraud or irregularity or a failure of internal controlsystems of a material nature and reporting the matter to the board.
h) Discussion with external auditor before the audit commence, nature and scope ofaudit as well as has post-audit discussion to ascertain any area of concerr.
i Reviewing the company's financial and risk management policies.
j To look into the reasons for substantial defaults in the payment to the depositors,debenture holders, shareholders (in case of non payment of declared dividends) andcreditors.
B. Remuneration Committee
The Remuneration Committee of the Company was constituted in accordance with ScheduleXIII of the Companies Act, 1956 to carry out functions as envisaged under the saidSchedule. The committee was constituted on 29!h June 2002. No any meeting ofthe committee was held during the year. The Company does not have any employees' stockoption scheme.
Composition of the Committee
The Remuneration Committee consists of the following Directors
|Name || |
|(i) Shri V.B.L. Mathur || |
Non Executive Directors
|(ii) Shri Shiv S. Sharma || |
|(iii) Shri Lt. Col. P.L. Bawa || |
|Curing the year No. of meeting of the committee was held. || |
Details of remunerations paid to Directors for the year.
The salary, perquisites and commission paid for the year-ended 31.3.2011 to ManagingPersonnel is as follows:
|S. No ||Name ||Title || |
|1 ||Shri Sudhir Khaitan ||Chairman & Managing Director || |
* Perquisites include housing allowance, medical reimbursenent, LTA, Club Fees, Bonus,Personal Accident Insurance, Gas and Electricity, use of movable assets and contributionto gratuity and provident funds. No stock options were assued. The Sitting Fees paid tothe Non-Executive Directors during the year is as follows :
|S No. ||Name of the Directors || |
Amount Paid Rs.
|i ||Lt. Col. Purshottem Lal Bawa || |
|2 ||Mr. Shiv S. Sharma || |
|3 ||Mr. V.B.L. Mathur || |
C Share Transfer / Investors Grievances Committee
a) Composition of the Committee: -
The Company has formed a Shareholder/Investor Grievance Committee consisting of thefollowing Director and Company Secretary: -1. Shri Sudhir Khaitan 2. ShriC. P. Vaid
As per SEBI Guidelines, the powers of processing of the share transfers both physicaland de-mat mode have been delegated to M/s MCS LTD, New Delhi (Share Transfer Agents) inorder to expedite the process of share transfers, issue of duplicate certificates andcertificates after splits/consolidation renewal and re-materialisation.
b) Terms of Reference: -
The terms of reference of the Investor Grievance Committee are as follows: -
? Ensure redressal of Shareholders and Investors complaints relating to transfer ofshares.
? Redressal of Investors complaints in respect of de-mat /re-mat and all othercomplaints whatever their nature.
The company confirms that there were no share transfers lying pending as on 31st March2011 and all requests for de-materialisation and re-materialisation of shares as on thatdate were confirmed/rejected into the NSDL/CDSL System.
4. Compliance Officer
Shri CP Vaid, Company Secretary is the Compliance Officer of the company for complyingwith the requirements of Listing Agreement entered into with the Stock Exchange as also ofSEBI (Prohibition of Insider Trading) Regulation, 1992. The E-mail ID of Mr. CP. Vaid firstname.lastname@example.org
5. Whistle Blower Policy
The company at present does not have Whistle B ower Policy.
6. Secretarial Audit
The company has appointed a qualified Practicing Company Secretary to conduct quarterlysecretarial audit of the company for reconcile the admitted capital with NationalSecurities Depositories Limited (NSDL) and Central Depositories Services Limited (CDSL;and the total issue and the listed capital. The secretarial audit reports confirm that thetotal issued/paid up capital is in agreement with the total number of shares held inphysical form and the total number of dematerialized shares held with NSDL and CDSL. TheAudit committee reviews the quarterly reports of the secretarial audit.
7 Share Transfer System
As per the SEBI guidelines, the company's share transfers, both physical and de-matmode has been carried by the share transfer agents i.e. M/s. MCS Ltd, Delhi, and allrequests for Transfer / De-mat are disposed off within the stipulated time.
(a) Shareholdina Pattern as on 31.3.2011 :
|Category || |
No. of Shares
% of Shares
|Promoter's Holding (including foreign promoters and persons acting in concert) || |
|Non Promoter's Holding || || |
|a) Mutual Funds & UTI || |
|b) Banks, FIs and Insurance Company || |
|c) Flls || |
|Others || || |
|a) Bocies Corporate || |
|b) Individuals || |
|c) NRIs/OCBs || |
|TO~AL || |
(b) Distribution of Shareholding:
|Range || |
No. of Shareholders
No. of Shares
% of Shares
|Upto 500 || |
|501 to 1000 || |
|1301 to 2000 || |
|2001 to 3000 || |
|3001 to 4000 || |
|4001 to 5000 || |
|5001 to 10000 || |
|10001 and above || |
|TOTAL || |
8. General Shareholder Information:
(a) Annual General Meeting
Forthcoming Annual General Meetings will be held on or before end of September'2011 atthe Company's Registered Office at Kanakpura F.O. Meenawala, Jaipur. The Separate Noticewill be issued to Shareholders on due time.
(b) Financial Calendar (Tentative) (April 1st 2011 to 31stMarch 2012)_
|Audited Results for the year ending 31.03.20 11 ||Adopted and published on 30th April 2011. |
|Mailing of Annual Reports 2010-2011 ||End of July 2011 |
|Financial Reporting for the quarter ending 30!h June, 2011 ||Mid of August 2011 |
|Financial Reporting for the quarter ending 30h September 2011. ||Mid of November 2011 |
|Financial Reporting for the quarter ending 31st December 2011. ||Mid of February 2012 |
|Financial Reporting for the quarter ending 31st March 2012. ||End of April 2012 |
|Secretarial Audit for the Quarter ending 30lh .une, 2011 ||End of July 2011 |
|Secretarial Audit for the Quarter ending 30th September, 2011 ||End of October 2011 |
|Secretarial Audit for the Quarter ending 31st December, 2011 ||End of January 2012 |
|Secretarial Audit for the Quarter ending 31st March, 2012 ||End of April 2012 |
|Half yearly compliance certificate regarding Transfer activities ||End of October 2011 |
|fo- the 1st half ended on 30th September, 2011 || |
|Half yearly compliance certificate regarding Transfer activities fo- the 2nd half ended on 31st March, 2012 ||End of April 2012 |
|Audit committee meetings ||End of April 2011, Mid of Aug. |
| ||2011, Mid of Nov. 11 & Mid of February 2012. |
|Share Transfer-cum-lnvestor's grievances committee meeting ||Monthly between 20th to 25,h of every month. |
(c)Listing of Equity Shares on Stock Exchange:
The shares of the company are listed at Bombay Stock Exchange. The Listing Fees for theyear 2010-11 has already been paid.
|(d) Name of the Stock Exchange || |
|Bombay Stock Exchange Limited || |
|Dalai Street, || |
|Mumbai - 400 001 || |
(e) Market Price Data:
|MONTH || |
HIGH AT B.S.E.
LOW AT B.S.E.
| || |
|April, 1C || |
|May, 10 || |
|June, 10 || |
|I July, 10 || |
|August, 10 || |
|September, 10 || |
|October, 10 || |
|November, 10 || |
|December, 10 || |
|January, 11 || |
|Februay 11 || |
|March, 11 || |
(f) De-materialization of Shares:
Liquidity - Shares of the company are under the category of compulsory delivery ofdematerialized node by all categories of investors.
The company has signed agreements with both the depositories i.e National SecuritiesDepository Limited and Central Depository Services (India) Limited, as on March 31, 2011,over 1,08,21,046 Nos. of shades of the company are already dematerialized.
The status as the dematerialized of the Equity Shares of the company is furnished below: Total No. of Equity Shares: 1,21,69,178 Total No, of Share Holders: 8.225
|Mode of Shareholding || |
No. of Shares
% to Equity Shares
No. of Shareholders
% of No. of Shareholders
|Physical || |
|Electronic || |
|TOTAL || |
g) Registrar and Share Transfer Agent (For phys cal and de-mat segment) M/s MCS Ltd.
F-65, 1st Floor, Okhla Industrial Area Phase-I, New Delhi 110 020. TEL NO:-011-41406149FAX:-011-41709881 Email:- adjn'nrffmcgtiel.gprn
h) General Body Meetings: -
Following General Meetings held in the financial year.
|Financial Year ||Date, Time and Venue |
|2009-10) ||29.09.2010 AT 11.00 A.M. at Registered office (AG.M) |
The details of last three General Meetings are as under:
1. Annual General Meeting held on 2009-10
a) No any Special Resolution was passed in the meeting.
2. Extra ordinary General Meeting on 15.01.2010
a) Special resolution passed by shareholders for preferential issue of convertibleequity share warrants of Rs.11.50 per share to Non-Promotor.
3. Annual General Meeting held on 29.09.2009
a) Special resolution passed by shareholders for ir crease remuneration of Mr. SudhiKhaitan, Promote and Managing Director of the company.
Postal Ballot: No special resolutions were required to be put through postal ballotlast year. Compliance Officer : CP. VAID
a. Related Party Transactions have been disclosed under Schedule No. 19 of Note to theaccounts for the year under review.
b. The Company has complied with all the requirements of the Listing Agreements withthe Stock Exchanges as well as regulation and guidelines of SEBI, if applicable,
o. There were no instance of non-compliance on any law or regulations (during the lastthree years) ard
hence, no penalties/strictures,
d. CEO/CFO Certification: - The Chairman & Managing Director & CEO (theCEO) and Financial Adv scr
have placed certificate for the period ended on 3 Ist March, 2011 before theBoard in accordance win
Clause 49(V) of the Listing Agreement,
j) Vleans of Communication:
The quarterly/un-audited/annually audited financial results of the Company are sent tothe Stock Excharges mmediately after the Board of Directors approved them.
The finarcial results are published in prominent daily newspapers in English and inHindi. The Annual Reports are posted to every shareholder of the company.
All developments, which have a major impact on the Company's financial, or operationsare informed to the Stock Exchanges.
Management Discussion and Analysis forms part of the Annual Report and Accounts sent tothe shareholders,
k) Re-appointment of Director also include
(a) Companies where he is a director
(b) Companies in which he is a member of the committee chairman
|1) Plant Location: - || |
|Factory _ocation ||Anil Special Steel Industries Limited |
| ||Kanakpura, PO. Meenawala, |
| ||Jaipur 302 012. |
|m) Address for correspondence : || |
|Correspondence with company ||Anil Special Steel Industries Limited |
| ||Kanakpura, |
| ||P.O. Meenawala, Jaipur 302 012 |
| ||Tel: -2470211,12,15 |
| ||Fax: - 0141-2470863, 2470014 |
| ||cpvaid(5)anilspecialsteel.com |
| ||Website: www.anilspecialsteel.com |
|Correspondence with Registrar ||M/s MCS Limited |
| ||F-65/1 Floor, |
| ||Okhla Industrial Area, |
| ||Phase -1 |
| ||New Delhi - 110 020 |
| ||Tel No. :- 011-41406149 |
| ||FAX:-011-41709881 |
| ||Email:- admin(5).mcsdel.com |
Auditor's Certificate on compliance with the conditions of Corporate Governance UnderClause 49 of the Listing Agreement
To :t~e members of Anil Special Steel Industries Limited
1 We have examined the compliance of conditions of Corporate Governance by Anil SpecialSteel Industries Limited for the year ended on 31st March 2011, as stipulatedin Clause 49 of the Listing Agreement of the said Company with stock exchanges.
2. The compliance of conditions of Corporate Governance is the responsibility of themanagement. Our examination was limited to procedures and implementation thereof, adoptedby the Company for ensuring the compliance of conditions of the Corporate Gcvernance. Itis neither an audit nor an expression of opinion on the financial statements of theCompany.
3. In our opinion and to the best of our information ard according to the explanationsgiven to us, we certify that the Company has complied with the condilions of CorporateGovernance as stipulated ir the abovementioned Listing Agreement.
4. We state that no investor grievances are pending for a period exceeding one monthagainst the Company as per the records maintained by the Shareholders / investors'Grievance Committee.
5. We further state that such compliance is neither an assurance as to future viabilityof the Company ncr the efficiency or effectiveness with which the management has conductedthe affairs of the Company.
f:or S.S. Surana & Co.
Membership No. : - 70331
R No. 001079C
Date: 30th April 2011