shoppers investment finance co ltd Directors report

SHOPPERS INVESTMENT AND FINANCE COMPANY LIMITED THIRTEENTH ANNUAL REPORT 1996 - 97 DIRECTORS REPORT Your Directors presents the THIRTEENTH ANNUAL REPORT together with Audited Accounts for the year ended 30th June, 1997. The Board of Directors had recommended a dividend of 10% at their meeting held on 30th September, 1997. However, in view of the embargo placed by Indian Bank, Leader of Consortium Banks, on declaration of any dividend, the Board of Directors are left with no alternative but to withdraw the recommendation earlier made in this regard. The Bombay and Madras Stock Exchanges have been intimated accordingly. OPERATIONS As you are aware, generally the Non Banking Financial Companies have not fared well this year when compared to the previous years due to the prevailing recessionary trend. In spite of the adverse conditions the Company is able to record a profit of Rs.2.94 Crores. FIXED DEPOSITS Unclaimed Deposits as on 30th June, 1997 amounting to Rs.4.82 Lakhs, of which deposits of Rs.2.24 Lakhs have since been repaid / renewed subsequently leaving a balance of Rs.2.58 Lakhs regarding which the Company has not received any instructions from depositors. DIRECTORS As per Article 107 of Articles of Association of the Company, the rotational Directors are appointed as per Section 265 of the Companies Act, 1956 for a period of three years and therefore no Director is due to retire at this Annual General Meeting. Mr. Mohan Parasaran resigned from the directorship of the Company with effect from 27/09/97. The Board places on record its appreciation of the valuable services rendered by him during his tenure as Director. INFORMATION UNDER CLAUSE 43 OF THE LISTING AGREEMENT Actual performance vis-a-vis Profitability Projections made in the prospectus of the Company dated 01/03/94 and Letter of Offer dated 02/04/94 is given below: PARTICULARS PROJECTIONS ACTUALS (Rs. in lakhs) 1996-97 1996-97 Sales (Including other income) 4463.68 6029.17 Profit after Tax 1602.59 293.68 Earnings per Share 10.68 1.97 The variations are due to: (i) More of trading and less of Hire Purchase and Leasing than envisaged. (ii) Profit is lower due to change in the product mix stated in (i) above. DISCLOSURES UNDER SECTION 217 OF THE COMPANIES ACT, 1956 The requirements of Section 217 (1) (e) of the Companies Act, 1956 relating to conservation of energy technology absorption and foreign exchange earnings or outgo are not applicable to the Company and hence no disclosure is being made in this Report. Information as per Section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, is not applicable since there is no employee falling under this category. AUDITORS M/s. Sampath Kumaran & Co., Chartered Accountants, Chennai, Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment. With regard to audit observations they are answered as under: a) Financial note No.2 is self explanatory regarding balance appearing under interest payable on fixed deposits and hirers control account. b) Stock on hire, sundry creditors and sundry debtors are being reconciled with subsequent payments and receipts, statement of accounts and/or confirmation as and when received. The matter is being followed up. c) Finance charges / lease income are being accounted on consistent basis every year and there has been no significant change in the method of accounting. Detailed reconciliation in the manner required by audit is under preparation. d) Of the total dividend of Rs.3.57 crores for the year 1995-96, dividend warrants to the extent of Rs.2.08 crores have since been encashed. Dividend warrants amounting to Rs.81 lakhs have not been encashed by the group Companies who are appreciative of the liquidity problems in the Company. The balance dividend warrants have not yet been encashed. The matter is being followed up. Non funding of the dividend in a separate bank account was due to liquidity problems beyond the control of the Company. ACKNOWLEDGEMENT Your Directors thank the Companys Bankers, Industrial Development Bank of India and Small Industries Development Bank of India for their continued assistance and support. Your Directors also thank all the shareholders, depositors and customers and appreciate the service rendered by the employees of the Company. By order of the Board, for SHOPPERS INVESTMENT & FINANCE CO. LTD. G. MOHAN Chairman & Managing Director Place: Chennai Date : 24th February, 1998