DIRECTORS
Dear Shareholder,
Your Directors take pleasure to present the 42nd Annual Report of VBC Industries
Limited together with Audited Financial Statements for the financial year ended 31st
March, 2014:
FINANCIAL RESULTS (HIGHLIGHTS):
| Particulars |
Current year 2013-2014 |
Previous year 2012-2013 |
|
(Rs. in Lakhs) |
( Rs. in lakhs) |
| Gross Revenue |
115.99 |
205.23 |
| Loss before interest Depreciation & Tax(PBIDT) |
165.94 |
333.32 |
| Add Interest & Financial Charges |
1065.75 |
479.03 |
| Loss before Depreciation & Tax(PBDT) |
1231.69 |
812.35 |
| Add: Depreciation |
178.26 |
148.57 |
| Loss before tax(PBT) |
1409.95 |
960.92 |
| Less: Provision for taxation including Deferred Tax Charge for the year |
195.41 |
42.50 |
| Loss after Tax (PAT) |
1214.54 |
918.42 |
| Profit brought forward from the previous year |
1074.16 |
1992.58 |
| Less Loss for the year |
1214.74 |
918.42 |
| Balance carried to Balance Sheet |
(140.38) |
1074.16 |
BUSINESS PERFORMANCE:
Your Directors wish to inform the members that during the Year 2012-13, the Company has
completed the modernization work of its Ferro Alloys unit at Dinnedeverapadu, Kurnool
District. However, because of severe power cuts imposed by the power distribution
companies due to acute power shortage in the state, the Company could not operate the
plant in the said year. The power crisis continued during the year under review and also
other issues pending with CPCDCL, the Company could not start its operations.
Consequently, the Gross revenue under report was only. Rs.115.99 lakhs compared to Rs.
205.23 lakhs of the previous year.
As the Company incurred loss during the year under report, your directors regret that
the company is not in a position to declare dividend to its shareholders.
PROSPECTS:
Indian Steel Industry is playing a significant role in the economic growth of the
country. The World Steel Association has estimated steel consumption in India to grow
considerably at a faster rate during 2014-15. The long term future of the Iron and Steel
Industry is optimistic and positive as Government of India is giving utmost importance to
develop infrastructure facilities and also housing needs of the population will enhance
the consumption of the Iron and Steel in the Country. However, a steep increase in power
tariff by the power distribution companies in Andhra Pradesh, has completely negated the
entire growth prospects of the Ferro Alloy Industry in Andhra Pradesh.
NEW PLANT:
Your Company’s plan to set up a modern integrated Ferro Alloys plant at
Akkallapalli Village, Bhimini Mandal of Adilabad District with a capacity of 45,000 MTS of
Silico Manganese was deferred in the present scenario.
INVESTMENT IN KGPL 445 MW GAS POWER PROJECT
Konaseema Gas Power Limited (KGPL) in which your Company has invested in equity was not
able to operate its power plant during the year under review due to non-supply of gas to
the Company from its suppliers from March, 2013 onwards.
INVESTMENT IN OPCL 20 MW HYDEL POWER PLANT
Orissa Power Consortium Limited (OPCL) which started generation of power under the 20
MW Hydro Electric Power Project and in which your Company also invested in equity,
generated 93.12 MU Power and during the previous year under review. The Company generated
a total revenue of Rs. 34.00 crores during 2013-14.
CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION:
In compliance with the requirements of Section 217(1)(e) of the Companies Act, 1956,
read with the Companies (Disclosure of particulars in the report of Board of Directors)
Rules, 1988, the statement showing the particulars in relation to conservation of energy,
technology absorbed and foreign exchange earnings and outgoings is furnished and forms
part of this report.
CORPORATE GOVERNANCE
As required under Clause 49 of the Listing Agreement, Reports on Management Discussion
& Analysis and Corporate Governance together with the Certificate of Auditors on
Corporate Governance are provided separately in this Annual Report and forms part of
Directors Report.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public.
PERSONNEL
Your Company is maintaining cordial relations with all its employees. Your Directors
and management express happiness for commitment and dedication shown by the employees.
PARTICULARS OF EMPLOYES READ WITH THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975,
AS AMENDED
There is no employee covered under Section 217(2A) of the Companies Act, 1956.
INSURANCE
Your Company’s movable and immovable assets have been adequately insured against
various risks.
DIRECTORS
APPOINTMENT OF INDEPENDENT DIRECTORS
As per the provisions of the Companies Act, 2013 and rules made there under, your
Company has to appoint at least three Director’s as Independent Directors.
Accordingly, Board recommends your approval for the appointment of Sri R.K.R. Gonela, Sri
M.V. Ananthakrishna and Sri V.S. Rao as "Independent Directors" for a period of
five years as per Section 149 of the Companies Act, 2013.
As per Section 160 of the Companies Act,2013, Shri J. Kameswra Sarma, Director is
liable to retire by rotation and eligible for re-appointment and the Board recommends the
same for your approval.
RESIGNATION OF DR. M.V.V.S. MURTHI, DIRECTOR OF THE COMPANY
Dr. M.V.V.S.Murthi, Director of the Company had resigned on 23-7-2014. The Board
accepted his resignation and had placed on record its appreciation for the valuable
services rendered by him during his tenure as the Director of the Company.
REPLIES TO AUDIT QUALIFICATION:
As advised by legal council your company has not made any provision for fuel surcharge
adjustment due to the cases pending before various forums/ courts. Your directors are of
the view that there are bright chances of winning the cases.
AUDITORS:
M/s. Brahmayya & Co., Chartered Accountants, the Auditors of the Company who retire
at the conclusion of the forthcoming Annual General Meeting have consented to continue in
office, if re-appointed. They have confirmed that their re-appointment, if made, will be
in accordance with the limits specified U/ s. 139 of the Companies Act, 2013. Your
Directors recommend their re-appointment for a period of three years up to the conclusion
of the Companys Annual General Meeting to be held in 2017 which is subject to the
approval for every Annual General Meeting.
COST AUDITORS:
Pursuant to the approval of the Central Government under Section 223B of the Companies
Act, 1956, the Company has re-appointed M/s. Nageswara Rao & Co., Cost Accountants,
Secundrahad (Firm Registration No.332) as the Cost Auditors of the Company for the
Financial Year ending 31st March, 2015.
DIRECTORS’ RESPONSIBILITY STATEMENT:
Pursuant to the requirements under Section 217(2AA) of the Companies Act, 1956, with
respect to Directors’ Responsibility Statement, it is hereby confirmed that:
(i) In the preparation of annual accounts for the financial year ended 31st
March, 2014, the applicable accounting standards have been followed along with proper
explanation relating to material departures.
(ii) Such accounting policies have been selected and applied and that such judgments
and estimates have been made as 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 the period.
(iii) Proper and sufficient care for the maintenance of adequate accounting records
have been taken 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.
(iv) The annual accounts of the company have been prepared on a ‘going concern
basis.
DECLARATION
The Company has been regular in filing all Forms and Returns with the Registrar of
Companies required under the Companies Act, 1956 and has not defaulted in repayment of
deposits, payment of dividend, redemption of debentures and preference shares.
Accordingly, the Company has not committed any of the defaults specified under Section
274(1 )(g) of the Companies Act, 1956 (as amended by the Companies Amendment Act, 2000)
disqualifying its Directors to act as Directors of other Public Companies.
ACKNOWLEDGEMENTS:
Your Directors thank all Members, customers, vendors, Regulatory & Government
Authorities and the Bankers of the Company for the full support extended by them. Your
Directors place on record their deep appreciation for the support and contribution of
employees through their dedication, hard work and commitment and look forward to the
future and confidence.
|
For and on behalf of the Board for VBC INDUSTRIES LIMITED |
|
Sd/- |
| Place : Hyderabad |
J.K. SARMA |
| Date : 12.08.2014 |
Director |
ANNEXURE TO DIRECTORS REPORT
A. CONSERVATION OF ENERGY :
Ferro Alloy Industry is highly power intensive and energy charges constitute a major
element in the cost of production. Company, therefore, gives importance to energy
conservation measures.
| POWER AND FUEL CONSUMPTION |
Current Year |
Previous Year |
|
2013-14 |
2012-13 |
| 1. Electricity |
|
|
| a. Purchase Units (KWH) |
Nil |
24,66,828 |
| Total Amount ( Rs. in lacs) |
Nil |
90.03 |
| Rate /Unit (in Rs. ) |
Nil |
3.65 |
| b. Own Generation |
|
|
| i) Through diesel generator |
Nil |
Nil |
| Units (KWH) |
Nil |
Nil |
| Units per Itrs. Of diesel |
Nil |
Nil |
| Cost / Unit () (Fuel + Oil) |
Nil |
Nil |
| ii) Through Steam Turbine /Generation |
Nil |
Nil |
| Units |
Nil |
Nil |
| Units per Itrs. Of fuel oil / gas |
Nil |
Nil |
| Cost / Unit |
|
|
| 2. Coal (specify quality & where used) |
|
|
| Quantity (Tones) |
Nil |
Nil |
| Total Cost |
Nil |
Nil |
| Average Rate |
Nil |
Nil |
| 3. Furnace Oil |
|
|
| Quantity (K. Itrs) |
Nil |
Nil |
| Total Cost |
Nil |
Nil |
| Average Rate |
Nil |
Nil |
| 4. Other internal generation |
Nil |
Nil |
| CONSUMPTION PER UNIT OF PRODUCTION |
|
|
| Electricity KWH/MT - Ferro Silicon |
Nil |
8,999 |
| Furnace Oil |
Nil |
Nil |
| Coal (Specify quality) |
Nil |
Nil |
| Others (specify) |
Nil |
Nil |
| B. TECHNICAL ABSORPTION : |
|
|
| 1. RESEARCH AND DEVELOPMENT (R&D) |
Nil |
Nil |
| a. Specify areas in which R&D is carried out by the Company |
Nil |
Nil |
| b. Benefits derived as a result of the above R&D |
Nil |
Nil |
| c. Future Plan of action: |
|
|
| a) Production of special grade Ferro Silicon for high grade Steels |
|
|
| b) Improvements in preparation of raw |
|
|
| material facilities |
|
|
| d. Expenditure on R&D |
|
|
| i) Capital |
Nil |
Nil |
| ii) Recurring |
Nil |
Nil |
| iii) Total |
Nil |
Nil |
| iv) Total R&D Expenditure as a percentage of total turnover |
Nil |
Nil |
| 2. TECHNOLOGY ABSORPTION, ADOPTATION & INNOVATION: |
|
|
| a. Efforts in brief, made towards technology, absorption, adaptation and innovation |
Nil |
Nil |
| b. Benefits derived as a result of the above efforts, e.g. product improvement, cost
reduction, product development, import substitution |
Nil |
Nil |
| c. In case of imported technology (imported during the last 5 years reckoned from the
beginning of the financial year), Following information may be furnished: |
|
|
| i) Technology imported |
Nil |
Nil |
| ii) Year of Import |
Nil |
Nil |
| iii) Has technology been fully absorbed |
Nil |
Nil |
| iv) If not fully absorbed, areas where this has not taken place reasons there for and
future plans of action |
Nil |
Nil |
| d. Foreign Exchange Earnings & Outgo |
|
|
| i) Foreign Exchange Earning at FOB Value |
Nil |
Nil |
| ii) Foreign Exchange Outgo - |
|
|
| A) CIF Value of Imports: |
|
|
| Raw Materials, Components and Spares |
Nil |
Nil |
| Capital Goods |
Nil |
Nil |
| B) Others |
Nil |
Nil |
|
For and on behalf of the Board for VBC INDUSTRIES LIMITED |
|
Sd/- |
| Place : Hyderabad |
J.K. SARMA |
| Date : 12.08.2014 |
Director |
+91-9892691696
