east india commercial company ltd Management discussions

EAST INDIA COMMERCIAL COMPANY LIMITED ANNUAL REPORT 2006-2007 MANAGEMENT DISCUSSION AND ANALYSIS FINANCIAL RESULTS: 2006-2007 (Rs.) Gross Surplus for the year 147,502,191 Less: Provision for Depreciation 45,128,812 Total Surplus for the year 102,373,379 Less: Provision for Taxation 38,271,000 Provision for Fringe Benefit Tax 263,000 38,534,000 63,839,379 Add: Deferred Tax Assets 2,827,958 Balance Brought forward from Previous Year 64,595,298 67,423,256 131,262,635 Which is proposed to be appropriated as under General Reserve 63,000,000 Interim Dividend on Equity Shares 5,413,480 Tax on Interim Dividend on Equity Shares 759,241 Balance Carried to Balance Sheet 62,089,914 131,262,635 PRODUCTION: Production during the year under review is 42181 M.T as against 40708 M.T, during the previous year. PERFORMANCE: Sri Krishna Jute Mills:- The performance in Sri Krishna Jute Mills Division (Eluru Mill) is generally satisfactory. During the year under review the unit has produced 26712 MT as against 25447 MT in the previous year and sold 26621 MT as against 25409 MT in the previous year. The company is confident of achieving higher production and sales levels during the current year. Krishna Hessians: Operations of Krishna Hessians unit, (at Kottur) has improved. During the year under review the mill has produced 15470 MT as against 15261 MT in the previous year and sold 16319 MT as against 14640 MT in the previous year. Exports have increased to Rs.951 lacs from Rs.794 lacs in the previous year. The Company is exploring new products for increasing exports. During the year under review, in Krishna Hessians, the Company has undertaken expansion of the shuttleless Weaving capacity to increase value addition. New mill shed is under construction and machinery is being acquired from indigenous suppliers and imports. The new unit is likely to commence production from November, 2007. Future Prospects: Jute Crop in 2007 is expected to be very satisfactory on account of sowing in larger areas and very favourable weather conditions that have prevailed all through. With good crop prospects, Jute prices, are expected to be economic. At the current trend availability of raw-jute is well assured for the Current Year and overall prospects are satisfactory.