Benzo Petro International Ltd Share Price directors Report
BENZO PETRO INTERNATIONAL LIMITED
ANNUAL REPORT 2011-2012
DIRECTORS REPORT
Dear Shareholders,
Your Directors submit herewith the 21st Annual Report of your Company for
the financial year ended 31st March, 2012.
1. SUMMARY OF FINANCIAL RESULTS:
FINANCIAL RESULTS (Rs. in Lakhs)
Particulars for the year ended 31.03.2012 31.03.2011
Net Sales & Conversion Income 9278.83 7187.54
Other Income 162.01 487.83
Profit/(Loss) before Depreciation,
Interest and Tax 104.66 715.38
Less: Depreciation & Interest 841.08 619.74
Profit/(Loss) before Tax (736.42) 95.64
Less: Exceptional Items (1.60) -
Less: Provision for Tax -
Fringe Benefit Tax - -
Profit/(Loss) after
Exceptional Items and Tax (738.02) 95.64
The figures of the previous year may have been re-grouped and re-classified
to conform to the current classification.
2. DIVIDEND:
In view of the losses incurred during the year under review, the Directors
do not recommend any dividend for the year under review.
3. OPERATIONS:
During the period under review, the operations of the Company witnessed
increase in Operational Revenue to Rs. 9278.83 Lakhs from Rs. 7187.54
Lakhs.
There has been a sharp decline in Other income amounting to Rs. 487.83
Lakhs in the last financial year to Rs. 162.01 Lakhs in the current
financial year.
During the year the Company has registered a Loss of Rs. 738.02 Lakhs
against a Profit before Tax amounting to Rs. 95.64 Lakhs in the last
financial year.
4. SALE OF WHOLE OF UNDERTAKING TO M/S. SUDAR INDUSTRIES LIMITED:
The Board of Directors at its meeting held on 7th July, 2012, proposed to
sale the whole of fixed assets of the undertaking of the Company pursuant
to Section 293(1)(a) of the Companies Act, 1956 to M/s. Sudar Industries
Limited, formerly known as M/s. Sudar Garments Limited for a total
consideration of Rs. 26 Crores. The consideration was agreed to be paid by
way of issue and allotment of 4000000 equity shares @ Rs10/= each fully
paid up at the premium of Rs.55/- of M/s. Sudar Industries Limited to Benzo
Petro International Limited. M/s. Sudar Industries Limited will allot the
said equity shares to M/s. Benzo Petro International Limited.
Currently, the Company is continuing to use the facilities for various
contract manufacturing services. However, on account of ownership being
transferred to M/s. Sudar Industries Limited, the Company and M/s. Sudar
Industries Limited have mutually agreed that the Company will continue to
use the facilities for a mutually agreed consideration.
5. ENVIRONMENTAL HEALTHS SAFETY:
The Company diligently endeavours to act in a responsible manner to ensure
a safe and accident free environment for its employees and contract
personnel. Health and Safety issues are addressed systematically,
effectively and proactively. Mock drills are conducted regularly for
different emergency situations for enhancing effectiveness of response
plan.
6. CORPORATE GOVERNANCE:
The Report on Corporate Governance as stipulated under Clause 49 of the
Listing Agreement forms part of the Annual Report. The Certificate from the
Statutory Auditor of the Company regarding compliance of the Corporate
Governance as stipulated in Clause 49 of the Listing Agreement with stock
exchanges is enclosed herewith.
7. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTGO:
Applicable particulars required under Section 217(1)(e) of the Companies
Act, 1956 read with Rule 2 of the Companies (Disclosure of Particulars in
the Report of the Board of Directors) Rules, 1988 is given as an Annexure
to this Report.
8. FIXED DEPOSITS:
The Company has not accepted any Fixed Deposits from public as envisaged
under Section 58A of the Companies Act, 1956, read with the Companies
(Acceptance of Deposit) Rules, 1975.
9. DIRECTORS:
a. Re-appointment of Mr. Rishi Agrawal, Non-Executive Independent Director:
Mr. Rishi Agrawal, Director of the Company is liable to retire by rotation
and being eligible, has offered himself for re-appointment.
Mr. Rishi Agrawal has a considerable experience in the area of commercial
and business development,
b. Regularisation of appointment of Mr. Mitul Patel, Non-Executive
Independent Director.
Mr. Mitul Patel was appointed as Additional Director of the Company at the
meeting of the Board of Directors held on 22nd March, 2012. As per the
provisions of Section 260 of the Companies Act, 1956, Mr. Mitul Patel will
hold office as a Director upto the conclusion of Annual General Meeting.
The Company has received notices in writing under Section 257 of the
Companies Act, 1956, proposing his candidature for the office of the
Director.
Mr. Mitul Patel has completed his graduation from M.S. University. He also
holds a diploma in Interior Designing from NIFD.
10. DIRECTORS RESPONSIBILITY STATEMENT:
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,
2012, 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, 2012 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, 2012 have been prepared on a
going concern basis.
11. STATUTORY AUDITORS:
M/s. Kiran Solanki & Associates Chartered Accountants, Statutory Auditors
of the Company, continues to hold office until conclusion of this Annual
General Meeting and have been recommended for re*appointment upto the
conclusion of next Annual General Meeting. In terms of Clause 41(1)(h) of
the Listing Agreement, the Statutory Auditors of the Company are subjected
to the Peer Review Process of Institute of Chartered Accountants of India
(ICAI), and should hold a valid certificate issued by Peer Review Board of
the ICAI. M/s. Kiran Solanki & Associates., Chartered Accountants hold a
valid certificate issued by Peer Review Board of the ICAI.
12. FOREIGN EXCHANGE EARNINGS AND OUTGO:
During the year under review, the company has imported Traded Goods having
value of Rs. 5809.50 Lakhs. However, there were no earnings in Foreign
exchange during the year.
13. PARTICULARS OF EMPLOYEES:
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. This information is furnished as per the requirements of Section
217(2A) of the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975, as amended.
14. APPRECIATION:
The Board of Directors would like to place on record their sincere
appreciation for the support and assistance extended by the Companys
suppliers, bankers, financial institutions, employees, customers, business
associates and various departments of the Central and State Governments for
their continued support and valuable cooperation.
Your Directors also express their gratitude to investors for support and
confidence reposed in the Company and Management.
For and on behalf of the Board
Sd/-
Place: Vadodara J. S. Sodhi
Date : 14.08.2012 Director
ANNEXURE TO THE DIRECTORS REPORT 2011-2012:
Particulars required under the Companies (Disclosure of particulars in the
Report of Board of Directors) Rules, 1988.
FORM: A
Form for disclosure of particulars with respect to conservation of energy.
CONSERVATION OF ENERGY:
Energy management and waste management awareness are being inculcated in
the entire workforce of the company.
Power and Fuel consumption in respect of total energy consumption:
Particulars for the year ended 31st March, 2012 31st March, 2011
1. Unit(KWH) 13,39,755 9,36,585
Total amounts (Rs. in Lakhs) 94.24 64.65
Rate per Unit 7.03 6.90
2. Oil/LSHS/LDO/HSQ/WOOD
Quantity (Lts) (L.D.O) 1,690 3,890
Total Amounts (Rs. in Lakhs) 1.49 2.82
Average Rate (Rs./Lts) 88.14 72.41
Quantity (Kgs) (WOOD) 14,45,897 10,82,338
Total Amounts (Rs. in Lakhs) 55.16 37.84
Average Rate (Rs./Kgs) 3.82 3.50
FORM: B
TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT:
The Company conducts basic research in its indigenous laboratory for better
productivity and quality improvements for its line of products, keeping in
mind the need for more commercially viable line of products and process.
Constant upgradation initiatives taken by the Company result in better
quality products, improved process performance, better cost management.
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:
1. Efforts in brief made towards : The Company continues to focus on
technology absorption. upgradation of the product and
process technologies in order to
reduce costs and improve the quality
standards.
2. Benefits derived as a result : The Company has benefited by way of
of the above efforts, e.g. quality and process improvements and
product imrovement, cost better cost management.
reduction, product development,
import substitution etc.
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
FORM: C
Total Foreign exchange used and earned:
(Rs. in Lakhs)
Current Year Previous Year
A. Foreign Exchange used:
a. Capital Goods (CIF) NIL NIL
b. Traveling and Membership Fees NIL NIL
c. Import
Raw Material CIF Basis NIL 102.42
Traded Goods 5,809.50 NIL
B. Foreign Exchange earned:
a. Export on FOB basis NIL NIL
For and on behalf of the Board.
Sd/-
Place: Vadodara J.S. Sodhi
Date : 14.08.2012 Director
MANAGEMENT DISCUSSION AND ANALYSIS
INDUSTRY STRUCTURE AND DEVELOPMENT, GLOBAL AND DOMESTIC:
The global pharmaceutical market is changing rapidly and growing more
complex. Annual global spending on medicines is expected to rise from $956
billion in 2011 to nearly $1.2 trillion in 2016as per the IMS Institute for
Healthcare Informatics report,
According to a study by IMS Healthcare, the global pharmaceutical market
has grown at a 7% CAGR over the past six years to reach a size of USD $880
million. Agrowth rate of 5% has been forecasted by IMS Health over the next
four years to reach a size of USD $ 1,100mn by 2015E.
Generics market has been the key player in this growth story for
pharmaceuticals on a global basis. The generics market has grown at a much
faster pace of 13.8% CAGR over the period, driven by large-scale patent
expiries and global demand for lower-cost drugs.
The recent spate of turbulence experienced in the Indian market has
resulted in high inflation levels, volatile industrial output and escalated
interest rates and have collectively caused a downward revision in the GDP
growth rates from 8% to 6.9%.
India, being the third largest market in the world pharmaceutical scenario,
in terms of volume, it is gaining its position as a global leader clearly
topping the charts among the Indian science based industries with
significant expertise in the complex field of drug manufacture and
technology.
Indias pharmaceutical market has registered a strong growth of 16% in
2012. This has been the highest growth in the past three years (Source:
Edelweiss Monthly, April 2012).
PERFORMANCE AND OPERATIONS OVERVIEW:
During the period under review, the operations of the Company witnessed
increase in Operational Revenue to Rs. 9278.83 Lakhs from Rs. 7187.54
Lakhs.
There has been a sharp decline in Other income amounting to Rs. 487.83
Lakhs in the last financial year to Rs. 162.01 Lakhs in the current
financial year.
During the year the Company has registered a Loss of Rs. 738.02 Lakhs
against a Profit before Tax amounting to Rs. 95.64 Lakhs in the last
financial year.
RISKS AND CONCERNS:
The Pharmaceutical industry works in a dynamic environment. Compared with
other industries, the risk and compliance profile span the full
pharmaceutical product life cycle.
Your Company lays emphasis on risk management and has an enterprise wide
approach to risk management, which plays a key role in identifying and
managing key operational and strategic risks.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has a widespread system of internal controls with the objective
of safeguarding the Companys assets, ensuring that transactions are
properly authorized, and provide significant assurance at reasonable cost,
of the integrity, objectivity and reliability of financial information.
HUMAN RESOURCES/INDUSTRIAL RELATIONS:
The Company continues to focus on its core values of knowledge, action and
care, which are also reflected in the behavior of the employees. There has
been no other material development in the Company, as far Human Resources
are concerned.
CAVEAT:
Shareholders are cautioned that certain data and information external to
the company is included in this section. Though these data and information
are based on sources believed to be reliable, no representation is made on
their accuracy or comprehensiveness. The management of the Company has
prepared and is responsible for the financial statements that appear in
this report. These financial statements are in conformity with accounting
principles generally accepted in India and therefore include amounts based
on informed judgments and estimates. The management also accepts
responsibility for the preparation of other financial information that is
included in this report. The management has based these forward-looking
statements on its current expectations and projections about future events.
Such statements involve known and unknown risks, uncertainties and other
factors that may cause actual results to differ materially. These factors
include, but are not limited to, changes in local and global economic
conditions, the Companys ability to successfully implement its strategy,
the markets acceptance of and demand for its products, growth and
expansion, technological change and exposure to market risks. By their
nature, these expectations and projections are only estimates and could be
materially different from actual results in the future. The Company
undertakes no obligation to publicly update or revise any of the opinions
or forward-looking statements expressed in this section, consequent to new
information, future events or otherwise.