pashupati seohung ltd Directors report
PASHUPATI SEOHUNG LIMITED
ANNUAL REPORT 1998-99
DIRECTORS REPORT
To The Members of
PASHUPATI SEOHUNG LIMITED
Your Directors have pleasure in presenting the seventh Annual Report on
business and operations the Company together with Audited Statements of the
Accounts for the year ended 31st March,1999.
The overall performance of the Company was not as per expectations during
the under review due to:
i) Sudden collapse in Russian economy, being the major market for your
Companys product, during sectioned half of 1998-99, the demand for Condoms
was drastically reduced and hence affected the turnover.
ii) Shortage of Working Capital resulted in under utilisation of plant
which ultimately resulted in downfall in production & hence increase in
fixed cost.
iii) During the precious year, (i.e. 1997-98), certain claims payable by
the Company were written bank under the head Other income, Which increased
profitability in last year.
OPERATIONS
During the period under review your Company cold not achieve the projected
targets due to reasons stated here in above. The summarised analysis of
salient operational points are highlighted :
i) Production: Your Company produced 63.80 million pieces of Male Rubber
Prophylactics (Condoms) during the period under review registering
utilisation of the 79,75% if installed capacity.
ii) Turnover : The Company has achieved a turnover of Rs. 690.50 lacs as
against Rs. 652.06 lacs for the previous year, thereby registering a growth
rate of 5,89% over last year.
ii) Profits : The Company registered a profit of Rs. 150,56 lacs before
providing interest, depreciation & tax, and net profit of 29,87 lacs during
the year under review.
EXPORTS
During the year under review the Company exported 74,45 MPC Male Rubber
Prophylactics amounting Rs. 517.77 lacs. The export turnover during current
year is expected to be about double of export turnover during the year
under review.
DIVIDEND
Due to insufficient profit, your directors do not recommend any dividend
for the period under review.
FUTURE OUTLOOK
During the year under review the Company could not do well, but in the
current year Company is performing extremely well. During the period of the
current year the Company has made significant improvement in terms of both
production as well as turnover. Your Company has orders in hand for supply
of condoms up to November 99. During period of the year 1999-2000 the
Company is operating at 100% of installed capacity. Due to revival of
Russian Economy, The demand has further improved. Considering the
continuous increase in demand, the Company has already undertaken the
expansion programme and negotiations are in Final stage. The Company is
hopeful to encourage its shareholders during current year.
FIXED DEPOSITS
During the year under review, the Company came out with a fixed deposit
scheme for public. The response of the public was quite satisfactory.
AUDITORS REPORT
Qualification is Statutory Auditors Report regarding (i) Valuation of
scrap, your Company being a 100% EOU, can not sell the scrap without
obtaining the permission from central Excise. The Company has already filed
an application for the same with the authority concerned & a part of the
permission and the same has been accounted for in the current year. (ii)
regarding provision for Gratuity, the same has been accounted for on cash
basis & (iii) regarding dues to Small Scale Industrial Undertakings, the
Company mainly imports most of the raw-materials required for the
production of condom. However the outstanding has not been assessed.
PARTICULARS OF CONSERVATION OF ENERGY, TECHNICAL ABSORPTION AND FOREIGN
EXCHANGE EARNING AND OUTGO.
As required under section 217(1)(e) of the Companies Act, 1956 read with
the Companies (Disclosures of particulars in the Report Board of Directors)
Rules, 1988 the particulars in respect of conservation of energy,
technology absorption and foreign exchange earnings and outgo are set out
in Annexeure A to the Directors Report.
PARTICULARS OF EMPLOYEES
Companies (Particulars of Employees) Rules 1975 as amended read with
Section 217(2A) of the Companies Act, 1956 are not applicable to the
Company as there are no employees drawing the minimum salary envisaged in
the rules.
INDUSTRIAL RELATIONS
During the year under review, Industrial Relations at the Unit of the
Company remained peaceful. Your Directors wish to place on record their
sincere appreciation for the excellent team work which the employees of the
Company at all levels contributed for the excellent performances of the
Company at its Singur.
DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
Companys Articles of Association, Mr. K. L. Murarka and Mr. R. N.
Jhunjhunwala, Directors, retire by rotation at the Seventh Annual General
Meeting, and being eligible, offer themselves for re-appointment.
AUDITORS
The Shareholders are requested to appoint M/s. B. Chhawachharia & Co.,
Chartered Accountants, Calcutta the existing Auditors as the Auditors for
the current year. The existing Auditors have under Section 224(1B) of the
Companies Act, 1956, furnished a certificate of their eligibility for the
appointment.
STATUS ON Y2K PREPAREDNESS LEVEL
Your Company has taken appropriate and effective steps to avoid Y2K risks.
The Company has replaced the hardware involved in date critical operations,
wherever requited. The company has also upgraded the operating system and
modified its software application to make it Y2K compliance. The necessary
expenditure to ensure Y2K compliance amounts to about Rs. 2.00 lacs which
is expected to be incurred by November 1999.
ACKNOWLEDGMENT
The Directors acknowledge the support extended to the Company by the Term
Loan Tending Financial Institutions, Bankers, Govt. Organisations, Foreign
Collaborators and Investors for their assistance and Co-operation. The
Directors also thank all Employees of the Company for the valuable services
and support during the year under review.
For and on behalf of the Board
Place : Calcutta M. L. Muraka
Dated : 7th August, 1999 Managing Director
A. TECHNOLOGY ABSORPTION
i) Research & Development (R & D)
Commercial Production at the Companys Plant has been declared from 6th
October 1994. The Company has at present full fledged Quality Assurance
Laboratory equipped with state-of-the art testing facilities. Product
Development activities are also being carried out in the Company has
formulated plants to set up a dedicated R & D Centre for improvement of the
product of the Company manufactured and the processes thereof.
ii) Technology Absorption, Adaptation and Innovation
The Companies Plant for manufacture of Male Rubber Prophylactics has been
set in technical collaboration with Seohung Industrial Co. Ltd.,Seohung,
South Korea for which necessary agreement was concluded on 27th April 1992.
The agreement included import of technology. The agreement aforesaid
provide continued long term support for the improvement of technology and
product development by the Collaborators. The plant has since been
operating satisfactorily and the quality of the product accepted by Foreign
Countries. The technology may therefore, be considered to have been fully
absorbed.
B. FOREIGN EXCHANGE EARNINGS AND OUTGO Rs. in lacs
i) Foreign Exchange earned 571.77
ii) Foreign Exchange Used 183.74
For and on behalf of the Board
Place : Calcutta M. L. Murarka
Dated : 7th August, 1999 Managing Director