finkurve financial services ltd Directors report

SUMAN MOTELS LIMITED ANNUAL REPORT 2001-2002 DIRECTORS REPORT To Dear Members Suman Motels Limited. Your Directors present the Eighteenth Annual Report of the company along with the Audited Accounts for the year ended 31st March 2002. FINANCIAL HIGHLIGHTS Rs. in Lacs Particulars 2001-02 2000-01 Sales & other income 1398 2633 Profit / Loss before depreciation & interest (74) (2) Less: depreciation 696 703 Interest 996 823 Profit / Loss before tax (1766) (1528) Profit allocated to investment scheme 0 0 Balance (1766) (1528) Add: Balance brought forward from previous year (567) (289) Appropriations: 0 0 Less: Transferred to General Reserves 0 0 Proposed Dividend 0 0 Dividend tax 0 0 Net Loss for the year carried to the Balance Sheet (2333) (1817) FINANCE & ACCOUNTS OPERATIONS Your Company has achieved a sales turnover of Rs.1,398.31 lacs for the period as compared to Rs.2,632.74 lacs for the previous year and incurred Net Loss after Tax of Rs.1,765.52 lacs against Net Loss of Rs.1,528.21 lacs for the previous year. Division-wise performance was as under; Resorts Division The Motels and Resorts Division generated sales revenue of Rs.1,297.02 lacs during the year as compared to Rs.2,606.89 lacs for the previous year. Bakery Division The operations of the Bakery Division generated a sale of Rs.45.67 lacs during the year as against Rs.25.85 lacs during the previous year. Mineral Water Division The Company started manufacture and bottling of mineral water during the year under review. The unit is located at Mangaon and has a capacity to bottle 30,000 bottles per day. The Company could bottle and sale 6,18,020 bottles during the year under review thereby achieving a sales turnover of Rs.55.62 lacs. ADVERSE FACTORS The tourism and hotel industry as a whole is passing through a phase of recession since the last 4 to 5 years. The September attacks in USA and the terrorism in Kashmir has only added to this as the flow of tourists into India has been severely affected. Financial Problems The Company has planned hotel projects at 4 different locations in south India in the year 1999-2000 at a total cost of Rs.3927.31 lacs. Your Company invested Rs.1527.31 lacs from its own resources towards promoters contribution and completed the club houses at these locations. However, in spite of giving in-principal sanction from financial institutions to participate in this project, it restrained from extending any additional support to your Company as they decided not to take any additional exposure of the hotel industry. Because of this your Company could not complete the hotel buildings without which revenues could not be generated. This affected the financial leverage of the Company. To add to these problems a new legislation "SEBI (Collective Investment Schemes) Regulations, 1999 brought about the closure of all the membership schemes like plantation schemes, etc. Such companies were directed to make immediate premature repayments of the amounts collected under such schemes. This not only strained the Companys cash flows but also affected the normal business of the Company as the customers / investors developed a negative psyche towards the Company. The enactment and implementation of another ordinance "Maharashtra Protection of Investors and Deposit Holders" by the government of Maharashtra pushed the Company further into cash flow problems. Under the provisions of this Act a deposit holder / investor can prosecute a Company denying premature refund of deposits. REFERENCE UNDER SECTION 15 OF THE SICK INDUSTRIAL COMPANIES (SPECIAL PROVISIONS) ACT, 1985. For the Financial Year ended 31st March 2002 the accumulated losses exceed the Net Worth of the Company. Therefore, the provisions of Section 3(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) are applicable and a reference under Section 15 of SICA will be made by the Company within the prescribed time limit to the Board for Industrial Financial Reconstruction. Income Tax Assessments The Companys Income tax assessments are completed upto the Assessment year 1998-99. Assessment for the Assessment year 1999-2000 is in progress. Various appeals before the Appellate Authorities are being pursued. DIVIDEND In view of the loss the directors do not recommend any dividend during the year. RESPONSIBILITY STATEMENT Pursuant to Section 217(2AA) of the Companies Act, 1956 the Directors confirm that :- 1. In the preparation of the accounts the applicable accounting standards have been followed; 2. Appropriate accounting policies have been selected and applied consistently and judgements and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the company as at 31st March 2002 and of the loss of the company for the period. 3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities. 4. The accounts have been prepared on a going concern basis. CORPORATE GOVERNANCE In terms of the Corporate Governance guidelines issued by the Stock Exchange, a report for the year 2001-02 is enclosed by way of Annexure "A" to this report. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO. As the company has minimal manufacturing activity the consumption of energy is minimal. Hence no separate details of energy consumption is provided in the report. The company has taken all possible steps in conserving the energy. Strict monitoring of the energy consumption at all units and educating the staffs to the awareness of conserve the energy conservation is done on a continuous basis. The company and its management is closely monitoring the energy consumption at all steps are being initiated to conserve the energy to the extent possible. The company has not adopted any foreign technology during the year. The company has not earned nor spent any foreign exchange during the year. FIXED DEPOSITS The Company has not taken any fixed deposits attracting the provisions of section 58A of the Companies Act 1956 and the rules made thereunder. PARTICULARS OF EMPLOYEES During the year there were no employees drawing remuneration attracting the provisions of section 217 of the Companies Act 1956 and the rules made thereunder. DIRECTORS During the year Shri. Vijay Kumar and Shri. Javed Akhtar have resigned from the directorship of the company. The directors place on record appreciation to the services rendered by them to the company. OUTSTANDING GDRS/ADRS/WARRANTS The company has not issued any GDRs/ADRs during the year. However there are payments due to the investors under the various schemes of the company which are being honored gradually. AUDITORS Shri Dedhia Talak Devji, Chartered Accountant Mumbai Auditors of the Company retires at the conclusion of the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. DETAILS OF THE STOCK EXCHANGE REQUIREMENT The additional details as required by the exchanges is provided in the Annexure "A" forming part of their report. ACKNOWLEDGMENTS Your Directors hereby than the employees, bankers and shareholders of the company for their valued co-operation and confidence reposed with the board. By Order of the Board For Suman Motels Limited Place : Mumbai Surendra M Khandhar Dated : 05.06.2002 Managing Director