cabot india ltd Directors report

Director Report

To the Members

Your Directors hereby present the Fifty-first Annual Report together with the Audited Accounts of the Company for the year ended March 31, 2014.

FINANCIAL RESULTS ;
Particulars		(Rs. in Lacs)
	Year ended on March 31, 2014	Year ended on March 31, 2013
Sales	1,371.84	1,754.95
Other Income (including non-recurring income)	0.50	2.76
Gross Profit before Interest & Depreciation from continuing operations	315.23	834.76
Less : Depreciation	44.76	22.62
Financial Charges	115.17	191.99
Profit from Continuing operations	155.31	620.14
Loss from Discontinuing operations	(87.50)	(115.34)
Profits before Tax	67.81	504.80
Less ; Provision for Tax (including earlier years and Deferred Tax)	—	21.81
Profit after Tax	67.81	482.99
Loss brought forward	(18,383.64)	(18,866.63)
Loss carried to Balance Sheet	(18,315.83)	(18,383.64)

During the year, the Companys activity focused on the sales, marketing and technical support of Cabot Corporations Specialty Blacks, Masterbatch product lines for the Indian sub-continent market. The Company continued to import all product lines from overseas affiliates to service some key segments of the market. In addition to the aforementioned product lines, the Company consolidated activities associated with the sales, marketing and technical support of Cabot Corporations Activated Carbon product line, a business Cabot acquired in August of 2012.

The country continues to maintain strong market segments that value high quality Carbon Black and Masterbatch products. These segments include IR inks and plastics. The recently consolidated Activated Carbon product line serves a variety of market segments, which include water & air purification, food & beverage and pharmaceuticals.

The Company expects competition in the market to remain intense with demand continuing to be strong in each of the market segments served. The addition of the Activated Carbon product line has diversified end application markets and provides the Company with a broader offering of high quality specialty chemical products.

The Company believes it will continue to build on its capabilities to best serve Customers in the India market providing the highest levels of service and differentiated specialty chemicals. This should position the Company to meet the challenges of the Indian market.

Considering the accumulated losses of the earlier years of the Company, no dividend is recommended for the financial year ended on March 31, 2014.

As on date, Cabot Corporation, USA through its subsidiary companies owns 97.80% of the paid-up capital of the Company.

In accordance with the Articles of Association of the Company and in view of the provisions of Companies Act, 2013, Mr. Fei Deng, Director of the Company, will retire by rotation at the ensuing Annual General Meeting and being eligible seeks re-appointment.

The Audit Committee assists the Board in its responsibility for overseeing the quality of the accounting, auditing and reporting practices of the Company and its compliances with the legal and regulatory requirements. In particular it performs the following functions:

• Overseeing of the Companys financial reporting process and disclosure of financial information and financial risk management policies.

• Review of financial statements ensuring compliance with regulatory guidelines before submission to the Board of Directors.

• Review of adequacy of internal control systems and discussions of significant internal audit findings including internal control and weakness, if any.

• Recommend appointment, removal of statutory auditors and payment of fees to them and appointment of CFO/ Whole-time Finance Director.

• Review areas of operation of internal audit team and their performance.

• Review the statement of significant related party transactions.

Present composition of the committee:

Sr. No.	Name of the member	Position
1.	Mr. C. R. Dua	Member
2.	Mr. Aled Rees	Member
3.	Mr. Nirmalya Maity	Member
4.	Mr. Vinod Joseph (Alternate Director to Mr. Nirmalya Maity)	Member

In compliance of Section 217(2AA) of the Companies Act, 1956, as amended by the Companies (Amendment) Act, 2000, the Directors of the Company confirm that:

• the applicable accounting standards have been followed in the preparation of final accounts and that there are no material departures;

• such accounting policies have been selected and applied consistently and such judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2014 and the Profit of the Company for the year ended on that date;

• proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• the accounts have been prepared on a going concern basis.

The Company has not accepted/renewed Fixed Deposits during the year under review.

SAFETY. HEAOH & ENVIRONMENT :

Safety, Health and Environmental is of the highest importance to the Company and is at the centre of every day operations. The Cabot Safety Health and Environmental (SH&E) Standards are applicable across Cabot facilities worldwide and its SH&E program covers all employees and contractors working at every site.

AUDITORS :

M/s. Deloitte, Haskins & Sells LLP, Chartered Accountants, Mumbai, retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. They have submitted a certificate of their eligibility for re-appointment under Section 139 of the Companies Act, 2013.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO :

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) Rule, 1988 for the period ended March 31, 2014.

(A) Conservation of Energy:

The Company is taking various initiatives to reduce the consumption of energy, such as use of energy saving equipments etc. Company is constantly engaged in interaction with external agencies/partners for exposure to latest products/designs, techniques, processes etc.

(B) Research & Development:

Your Company has undertaken certain measures to undertake the research and development activities that are essential to nature of business of the Company.

(C) Technology Absorption:

Your Company has embarked on steps under a predefined strategy for technological absorption for the development of business of Company.

(D) Foreign Exchange Earnings & Outgo:

Particulars	For the year ended on 31st March, 2014 (Amount in Rs.)	For the year ended on 31st March, 2013 (Amount in Rs.)
Earnings in Foreign Currency	12,29,72,675	15,99,05,453
Expenditure in Foreign Currency	1,96,210	3,90,016

HUMAN RESOURCE AND PARTICULARS OF EMPLOYEES :

The human resource philosophy and strategy of your Company has been designed to attract and retain the best talent on offer. In practice it creates and nurtures work place challenges that keep employees engaged, motivated and innovative.

Information as per Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 forms part of this report.

ACKNOWLEDGEMENT :

Your Directors would like to express their appreciation for the assistance and co-operation received from the shareholders, customers, dealers, suppliers, banks, financial institutions, Government authorities, Export Promotion council, other semi Government authorities and business associates at all levels during the year under review. The Directors also wish to place on record their deep appreciation for the committed services of the staff and executives of the Company.

	For and on behalf of the Board
	C. R. Dua	Director
	Aled Rees	Director
Date : October 20, 2014

ANNEXURE TO DIRECTORS REPORT

Particulars as required under section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, and forming part of the Directors Report for the year ended 31 st March, 2014.

Name	Age (Yrs.)	Designation	Remuneration Received in Rs.	Qualification	Date of Commencement of Employment	Last Employment	Total Experience (Yrs.)
Sriram Srinivasan	48	President	2,28,07,346*	MS, Chemical Engineering BE, Chemical Engineering	September 9, 2013	Cabot Corporation	24

* Remuneration includes Salaries, Allowances, Perquisites and Contribution to Provident Fund.

	For and on behalf of the Board
	C. R. Dua	Director
	Aled Rees	Director
Date : October 20, 2014