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Avon Organics Ltd

BSE: 531541 | NSE: ISIN: INE881A01015
Market Cap: [Rs.Cr.] 119.48 Face Value: [Rs.] 10
Industry: Chemicals

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Director's Report


The Members,

Your Directors have pleasure in presenting their Twenty- First Annual Report on the business and operations of the Company and the Audited Financial Accounts for the year ended 31st March, 2014.


(Rs. in Lakhs)
Particulars 2013-14 2012-13
Revenue from Operations 5,688.67 17,015.04
Other Income 18.37 21.65
Total Revenue 5,707.04 17,036.69
Operating Costs 5,193.19 13,650.55
Profit/(Loss) Before Depreciation, Interest. Tax (PBDIT) (486.15) 3,386.14
Depreciation 961.88 996.51
Profit/(Loss) Before Interest
& Tax (PBIT) (1,448.03) 2389.63
Profit/(Loss) Before Tax (PBT) (3,202.91) 879.41
Provision for Income Tax - 200.00
Deferred Tax 54.43 51.97
Profit/(Loss) for the year (3,257.34) 827.44

Previous Year's figures have been regrouped/ reclassified wherever necessary to conform to the current year’s classification.


In view of loss incurred during the year, Your Directors do not recommend any dividend on Equity Shares for the year under review.


During the year, the Company registered a significant decline in Net Sales and the Operational income for the year was Rs. 5688.67 Lakhs as against 17015.04 Lakhs in the previous year, registering a decrease in sales by 66.57%, primarily the same was on account of Company’s high dependence on certain customers with whom your Company could not do business as compared to previous years and also on account of multiple issues including the one's at the customers end beyond the control of your company. Also the market remained sluggish for the API & Intermediates players.


During the year under review, Capital work in progress amounting to Rs. 291.90 Lakhs was capitalized and in addition Rs. 261.57 Lakhs was incurred on maintenance capex.


The Company continues with its efforts to maintain highest quality standards and complies with various regulations as required by laws for supplies of products to various territories. The Company currently has following valid certifications:

• ISO 9001:2008

• The Solapur unit of the Company is cGMP compliant and is USFDA inspected.


Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that:

a) In the preparation of the annual accounts for the year ended 31st March, 2014, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) Your Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 31st March, 2014 and of the Profit and Loss Account for the year ended on that date;

c) Your Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the Assets of the company and preventing and detecting fraud and other irregularities and

d) The accounts for the year ended 31st March, 2014 have been prepared on a going concern basis.


Your company has been proactive in following the principle and practice of good corporate governance. The Company has taken adequate steps to ensure that the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement of the Stock Exchanges are complied with.

A separate statement on corporate governance is annexed as a part of the Annual Report along with the Auditors certificate on its compliance. A report in the form of Management Discussion and Analysis pursuant to clause 49 of the Listing Agreement, as a part of this report is annexed hereto.


Mr. Rajendra Kaimal (DIN: 00032839), Non-executive Chairman & Managing Director retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Mr. Manoj Jain (DIN: 00034727), Non-executive Director retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Dr. Sunil Pitroda (DIN: 07028212), was appointed as an Additional Director of the Company, in the category of an Independent Director. Pursuant to Section 161(1) of the Companies Act, 2013, Dr. Sunil Pitroda holds office till the date of this Annual General Meeting and it is proposed to appoint him as an Independent Director of the Company for the period of 5 years from December 30, 2014 to December 29, 2019.

Brief profiles of the abovementioned Directors are included in a separate Annexure after the Notice, forming part of this Annual Report.


The Board of Directors commends the continued dedication & support of employees at all levels. During the year under review the Management has made best efforts to keep the industrial relations peaceful and cordial.

Section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 as amended, requires Companies to list out names of the employees drawing remuneration of more than Rs. 5 Lakhs per month and/or more than Rs. 60 Lakhs Per annum.

However, none of the employees of the Company drew remuneration of Rs. 60 Lakhs or above per annum and/or Rs. 5 Lakhs or above per month during the year under review.


M/s. Mukesh Mehta & Associates, (Registration No. 116309W) Chartered Accountants, Mumbai, the statutory auditor of the Company hold office until the conclusion of the ensuing Annual General Meeting of the Company. The said Auditor have been holding office as Statutory Auditor of the Company for a period of 10 (Ten) consecutive financial years. In terms of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, a listed company cannot appoint or re-appoint an audit firm as an Auditor for more than two terms of five consecutive years. The period for which the firm has held office as Auditor prior to the commencement of the Companies Act, 2013 shall be taken into account for calculating the period of 10 (Ten) consecutive years, as the case may be. Further Section 139 of the Companies Act, 2013 has also provided a period of 3 (Three) years from date of commencement of the Act to comply with this requirement and accordingly they can be appointed as Auditors for a further period of 3 (three) years only in terms of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014. Accordingly it is proposed to appoint M/s. Mukesh Mehta & Associates, (Registration No. 116309W) Chartered Accountants, Mumbai as statutory auditors of the Company to hold office from the conclusion of the Twenty First Annual General Meeting till the conclusion of the Twenty Fourth Annual General Meeting of the Company, i.e. for a period of 3 (Three) years, subject to ratification of their appointment at every annual general meeting. The statutory auditor has confirmed their eligibility and willingness to accept office, if re-appointed.


The information relating to Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo as required to be disclosed under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are set out as an annexure forming part of this Report.


During the year under review, the company has neither invited nor received any deposits from the public.


The Board of Directors take this opportunity to thank the Financial Institutions, Banks, employees, business associates, suppliers, Stock Exchanges, other regulatory authorities and all the stake holders of the Company for valuable sustained support and cooperation in conducting the operations of the Company. The Board also places on record the sustained management support received from M/s. Arch Pharmalabs Limited, the Parent Company.

For and on behalf of the Board
Date: 05.12.2014 Sd/- Sd /-
Place: Mumbai Manoj Jain Ajit Kamath
Director Chairman & Managing Director
DIN:00034727 DIN:00032799


Information under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988

A. Conservation of Energy:

a. Energy Conservation Measures taken : The Company is engaged in continuous process of energy conservation through improved operational and maintenance practices.
b. Total energy consumption per unit of Production : Details are furnished in Form A
B. Technology absorption : Details are furnished in Form B


C. Foreign Exchange Earnings and Outgo 2013-2014 2012-2013
1. Foreign Exchange Earnings (Rs. In Lacs) 198.79 3716.64
2. Foreign Exchange outgo (Rs. in Lacs) 992.53 1637.40
3. Net Foreign Exchange Earnings (outgo) (Rs. In Lacs) (793.74) 2,079.24


Form for disclosure of particulars with respect to conservation of energy.

2013-2014 2012-2013
a. Purchased Units: (In KWH) 1638640 6422148
Amount (Rs. In lacs) 166.14 466.28
Rate/Unit(Rs.) 10.14 7.26
b. Own Generation:
Through D. G. Set Units (In KWH) 10851 262155
Amount (Rs. In lacs) 3.02 40.85
Rate/Unit(Rs.) 27.81 15.58
2. FURNACE & BOILER (Rs.in lacs) 39.55 345.18



1. Specific areas in which R & D was carried out.

The Company continued its research on CEFDINIR intermediate, which is ready to be implemented at the plant for commercial quantities.

2. Benefits derived from above R & D.

- There would be considerable cost advantage on the manufacture of CEFDINIR intermediate in commercial quantities.

3. Future plan of action.

- To achieve increased production of DEAA (Diethyl aceto acetamide) and CEFDINIR intermediate.

4. Expenditure on R & D: (Rs. In lacs)
2013-14 2012-13
Revenue Expenditure 19.42 32.93
% to Turnover 0.34% 0.19%


1 Efforts in brief made towards technology absorption : Consistent efforts made towards achieving the required quality of Pseudoephedrine Hydrochloride.
2 Benefits derived as a result of the above efforts, e.g. product improvement, cost reduction, product development, import substitution etc. : Cost reduction in Pseudoephedrine Hydrochloride.
3 In case of imported technology (import during the last 5 years reckoned from the beginning of the year); following information may be furnished
a Technology imported Nil
b Year of import Not Applicable
c Has technology been fully absorbed Not Applicable
India Infoline Research
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Key Information

Key Executives:

Ajit Kamath , Chairman & Managing Director

Manoj Jain , Whole-time Director

Rajendra Kaimal , Director

Jignesh Patel , Company Secretary

Company Head Office / Quarters:

Survey No 18 Yawapur Village,
Sadasivpet Mandal,
Andhra Pradesh-502291
Phone : Andhra Pradesh-91-9949828084 / Andhra Pradesh-
Fax : Andhra Pradesh-91-40-23404438 / Andhra Pradesh-
E-mail :
Web :


XL Softech Systems Ltd
Plot No 3 Sagar Soci,Road No 2,Banjara Hills,Hyderabad - 500034

Fund Holding
Scheme Name No. of Shares
Mon Tue Wed Thu Fri Sat Sun
22 23 24 25 26 27 28