tamil nadu petro products ltd Directors report

PARASRAMPURIA INDUSTRIES LIMITED ANNUAL REPORT 2002-2003 DIRECTORS REPORT DEAR MEMBERS Your Directors submit their Seventeenth Annual Report together with the Audited Statement of Accounts for the year ended 31st March, 2003. 2002-2003 2001-2002 (Rs. in Lacs) (Rs. in Lacs) FINANCIAL RESULTS Turnover 9461.38 9412.22 Gross Profit before Interest, Depreciation & Taxes (-)324.40 (-)58.39 Less : i) Interest 686.60 1072.97 ii) Depreciation 469.97 498.85 Profit before Taxes (-)1480.97 (-)1630.21 Less : Provision for Taxes - - Profit after Taxes (-)1480.97 (-)1630.21 Add : Balance brought forward from the previous year (-)10871.10 (-)9240.89 Balance Carried to - - Balance Sheet (12352.07) (10871.10) OPERATIONS SYNTHETIC YARN DIVISION During the year under review, the company has achieved a turnover of Rs.9461.38 lacs as against Rs.9412.22 lacs for the previous year. The loss (before providing for Depreciation and interest) has increased to Rs.324.40 lacs as against a loss of Rs.53.39 lacs suffered by the Company in the previous year. The Synthetic Filament Yam Industry continued to reel under recessionary conditions during the year under review. Although there has been a growth in the consumption of Polyester POY, the problem of oversupply in the domestic market continues. During the current year, it is expected that the demand supply position will break-even resulting in better prospects for your Company. DIVIDEND No Dividend has been declared on account of loss suffered by the Company. EXPANSION PROJECT As informed in the last Directors Report, the proposed Expansion Project for increase in the capacity from 9,750 TPA to 15,600 TPA still remains incomplete in the absence of availability of the requisite funds for the same. Hence, no progress was made during the year under review. The expected ECB proposal could not materialise uptill now. EXPORTS During the year under review, the Companys exports including deemed exports were Rs.3201.48 lacs as against Rs.1150.00 lacs for the previous year. COMPANY S REFERENCE TO BIFR In the month of July 2002, the Company has filed an Appeal in AAIFR against the Order passed by the Honourable BIFR Bench that the reference filed by the Company is non-maintainable. The decision of BIFR on this appeal filed by the Company is still pending. Hence, BIFRs protection to the Company continues. LEGAL MATTERS: As informed in the last Directors Report. all legal proceedings for recovery against your Company has been stayed till the reference is decided by BIFR/AAIFR. However. during the year under review, the Government has enacted "The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002" under which Banks and Financial Institutions have been given powers to take possession of securities of defaulting companies. In this regard the Company has received Notices from Financial Institutions and Banks under the said Act. The Company is in dialogue with the Banks and Financial Institutions to try and find an applicable solution which would be in the interest of all parties. EXTERNAL COMMERCIAL BORROWING (ECB) The Company is not able to get the necessary permission from Government of India and is still pursuing the matter. ASSIGNMENT OF LOAN BY ICICI BANK LTD. During October 2003 ICICI Bank Ltd. has assigned the debt owed to them by our Company to a Private Party. Under the said assignment, ICICI Bank Ltd. has settled the amount to be paid to them by the said Private Party in a particular time frame after which all the rights, title and interest of M/s. ICICI Bank Ltd. (including the suit filed by them in DIRT, Mumbai) would be transferred to the said Private Party. The said assignment of debt was informed to the DRT, Mumbai. FIXED DEPOSITS As on 31st March, 2003 Deposits of Rs.4.23 lacs had matured and were due for repayment but remained unclaimed. However, out of these Deposits a sum of Rs. 3.08 lacs has since been repaid. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION As required by the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules 1988, the relevant data pertaining to Conservation of Energy and Technology Absorption under Section 217(e) is annexed hereto and forms part of this Report. PARTICULARS OF EMPLOYEES During the year under review, the Company had no employee whose particulars are required to be mentioned pursuant to the provisions of Section 217(2A) of the Companies, Act, 1956 read with Rules thereunder as amended from time to time. LISTING AGREEMENT COMPLIANCE The Companys securities are listed with the Stock Exchange, Mumbai and Delhi Stock Exchange Association Limited, Delhi. INDUSTRIAL RELATIONS The Company had harmonious Industrial Relations at all levels of the Organisation. It will he the endeavour of the Company to continue to maintain such relations. The Directors express their appreciation for the services rendered by the Employees of the Company at all levels. RESIGNATION OF SHRI R.S. BUBNA, GENERAL MANAGER (LEGAL) AND COMPANY SECRETARY Shri R. S. Bubna resigned from the Company with effect from 01/03/2003. The Directors place on record their sincere appreciation of the services rendered and for the valuable guidance given by him during his long association with the Company. DIRECTORS In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Mrs. Bhagyam Ramani retires by rotation and being eligible, offers herself for reappointment. DIRECTORS RESPONSIBILITY STATEMENT In accordance with the provisions of Section 217 of the Companies Act, 1956, your Directors state ; I. that in the preparation of Annual Accounts, applicable Accounting Standards have been followed. II. that they have selected such Accounting Policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the loss of the Company for that period. III. that they have taken proper and sufficient care 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 irregularities. IV. that the Annual Accounts have been prepared an a Going Concern basis. CORPORATE GOVERNANCE: As per Clause 49 of the Listing Agreements with Stock Exchanges, your Company has come under the ambit of Corporate Governance. However. inspite of sincere efforts to induct independent directors on its Board, the Company was unable to appoint the requisite number of directors. Hence the Company could not comply with Clause 49 of the Listing Agreements with the Stock Exchanges. AUDITORS: M/s. M. L. Sharma & Company, Chartered Accountants, the retiring Auditors of the Company, offer themselves for reappointment by indicating their eligibility under Section 224(1) the Companies Act. 1956. With reference to the observations made in the Auditors Report the notes on accounts as contained in Schedule 13 of the Annual Report are self-explanatory and therefore do not call for any further comments under Section 217(3) of the Companies Act, 1956. On Behalf of the Board of Director Place : Mumbai RATANLAL PARASRAMPURIA Dated : 28th November, 2003 Chairman ANNEXURE TO DIRECTORS REPORT REPORT ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO IN ACCORDANCE WITH THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988. A. CONSERVATION OF ENERGY 1. Energy Conservation measures taken The Company has taken the following measures for energy conservation i) HSD Fuel Operated D.G. Sets converted to L.D.O./S.K.O Operated to reduce the cost of fuel. ii) Two D.B. Sets, Intercooling System provided by installing Heat Exchanger to reduce fuel consumption. iii) Fresh Air Ducts provided on D.G.Sets to increase Air Filler Life and Engine performance. iv) F.O. Based Engines installed on hired basis to get reduced electric power at low unit cost. v) At Piparia Plant utilisation of natural air for Airconditioning is implemented by installing Ceilulosic Pads in AHUs and FRP return air fans to achieve required cooling at D.Tex area and to reduce refrigeration load, thus saving electric load. vi) At Dadra Plant utilisation of Natural Air for Draw Texturising, Air Conditioning implemented by installing Air Fans. 2. Additional Investments and Proposals if any, being implemented for reduction of consumption of energy i) Study is undertaken for using low cost fuels in Power Generators. ii) Study is undertaken for inc, easing of production by installing additional Winders on some lines. iii) Study is undertaken for using of FRP Fans in place of Aluminium Fans of Airconditioning Systems. 3. Impact of the measures at 1 & 2 above for reduction of energy consumption & consequent impact on cost of production of goods: We have been able to reduce the power consumption substantially by virtue of various schemes in hand. 4. Total energy Consumption and energy consumption per unit of production; The details are provided in Form B annexed hereto. B. TECHNOLOGY ABSORPTION Details as per Form B annexed hereto. C. FOREIGN EXCHANGE EARNINGS AND OUTGO 2002-2003 2001-2002 (Rs. in lacs) 1. Foreign Exchange Earned 247.27 1149.78 2. Outgo of Foreign Exchange i. CIF Value of imports 928.29 627.45 ii. Expenditure in Foreign Currency 1.05 12.77 FORM `A Form For Disclosure of Particulars With Respect To Conservation of Energy. 2002-2003 2001-2002 A. Power and Fuel Consumption ; 1. Electricity a. Purchased Unit (KWH in thousands) 9259 10997 Total amount (Rs. in lacs) 266.07 318.65 Rate/Unit Rs. 2.84 2.72 b. Own Generation Through Diesel Generator Unit (KWH in thousands) 17624.39 17546.85 Units per ltr of diesel oil 3.61 3.56 Cost per Unit (Fuel only) Rs. 3.59 3.68 Coal Nil Nil 3. Furnace oil Quantity (K ltrs) 827.37 1056.71 Total Amount (Rs. in lacs) 85.06 87.18 Average Rate Per ltr Rs. 10.28 8.25 4. Others Nil Nil B. Consumption per unit of production PP/Text/ PP/Text/ Crimped/ Crimped/ POY Yarn POY Yarn 1. Production (with details) 12026.22 MT 12306.40 MT 2. Electricity (Purchased + Own Generation) (KWH in thousands) 26983.85 29258.72 3. Furnace Oil (K ltrs) 827.32 1056.71 4. Coal Nil Nil 5. Electricity (KWH) per Kg. of Yarn produced 1.53 2.38 FORM `B FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION RESEARCH AND DEVELOPMENT 1. Specific areas in which research and development carried out by the Company. - Development of new Deniers & Colours to cater to the export potential. - Development of new indigenous master batches for PP/Polyester. Development of Semi-Dull Micro Filament Polyester Yarn for finer dpf - Development of Dope Dyed Polyester Filament Yarn with finer dpf in different colours trials taken. - Polymer ciltration improvement done, causes increase in pack life. - Packed weight of POY is increased to reduce the waste. - Development of indigenous Spin Finish Oils. - Development of indigenous P.P.chips & running successfully. 2. Benefits derived as a result of the above research and development, - Reduction in cost of Master Batches by Import Substitution - Reduction in cost by using indigenous Spin Finish Oil. - New Shades developed to improve marketing. - Cost reduction/improved utilisation of energy. - Technological upgradation. - Maintaining market leadership/preparedness to counter competition in the changed liberalised environment. - Pun Polyester on Polypropylene lire successfully. - Production increased in Polypropylene line by changing input. - Production of Polyester Semi-bright & Cationic yarn started and running successfully. - Production of Trilobal coloured yarn started, running successfully. 3. Future plan of action Continuation of present work in R & D for introduction of new novelty yarns and processor, improvements in the existing products and processes in various areas in which the Company is operating. 4. Expenditure on R & D a) Capital ) b) Recurring ) The expenditure has been charged under c) Total ) primary head of account. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION.: 1. Efforts in brief made towards technology absorption, adaptation and innovation Continuous interaction with technical collaborators has been maintained to upgrade ourselves for the technology development by collaborators. Our technical people have been attending various Seminars and workshops being organised by various institutions. We kept a close interaction with our sister concern to exchange the developments taking place at each others place. 2. Benefits derived as a result of the above efforts, e.g. product improvement, cost reduction, product development. import substitution etc. New shades & deniers development to keep ourselves ahead in competitiveness. Indigenous vendors for consumables developed to reduce the cost. 3. In case of Imported Technology (imported during the last 6 years recknoed form the beginning of the financial year) following information may by furnished : No Technology has been imported during the last 6 years.