gandhinagar enterprises ltd Directors report

GANDHINAGAR HOTELS LIMITED ANNUAL REPORT 2010-2011 DIRECTORS REPORT Dear Shareholders, Your Directors have pleasure in presenting the 31st Annual Report together with the Audited Accounts for the year ended 31st March, 2011 FINANCIAL RESULTS (Rs. In Lacs) Particulars For the year For the year ended ended 31st March, 2011 31st March, 2010 Profit before Depreciation, interest and taxation (EBIT) 506.48 335.50 Less : Depreciation 286.72 199.81 Less : Interest 132.32 59.01 Profit Before tax (PBT) 85.03 76.68 Provision for taxation 15.77 17.30 Deferred tax expenses 46.32 07.28 Profit after tax (PAT) 22.95 44.92 (Deficit)/surplus brought form previous period 42.37 39.37 Proposed Dividend 0.00 42.24 Tax on dividend (dividend distribution tax) 0.00 7.18 Balance carried to the Balance sheet 65.32 42.05 REVIEW OF OPERATIONS During the year under review the performance of the Company was up to the mark due to growing industrialization in the state of Gujarat and various initiative of Gujarat Government for development of tourism give positive results for the Current financial year. The Company has earned gross revenue of Rs. 506.48 Lacs for the financial year 2010-2011 which was Rs. 335.50 Lacs in previous year showing 51% rise in the gross revenue of the Company. PARTICULARS OF EMPLOYEES There were no employees covered under the provisions of Section 217 (2A) of the Companies Act, 1956 read with Companies (particulars of employees) rules, 1975 hence, particular are not given for the same. DIVIDEND In cater the finance requirement of business operations Your Directors do not recommend Dividend for the financial year ended on 31.03.2011. INSURANCE The Company has taken all necessary steps to insure its properties and insurable interest as deem appropriate and as required to have under various statutory and other requirement. DIRECTORATE During the year 2011, the sad demise of Chairman Major Vinodchandra P Joshi (Retd.) occurred. The company is highly indebted to him for his vision, commitment and services orientation implanted in the Company. The board of directors express sincere obituary to him. During the year Mr. Viral V Joshi resigned from the directorship of the company due to his pre-occupancy. Mr. Dlipkumar K Trivedi and Wg. Cdr. Manik Anchlia retire at ensuing Annual General Meeting and are eligible for reappointment. AUDIT COMMITTEE The Company has formed the audit committee as per the provisions of section 292 A of the Companies act, 1956 and Clause 49 of the listing agreement. The Audit committee consists of following members: AUDIT COMMITTEE Mr. Popatbhai V. Patel - Chairman Mr. Dilipkumar K Trivedi - Member Mr. Dinesh M Mundra - Member DIRECTORS RESPONSIBILITY STATEMENT As Required under Section 217(2AA) of the Companies Act 1956, we hereby state that:- 1. That in the preparation of the annual accounts, the applicable accounting standards has been followed, along with proper explanation read with the notes to the accounts relating to material departures; 2. That the 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 as at 31st March, 2011 and of the profits of the Company for the year end on that date. 3. That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records 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. 4. That the Directors had prepared the Annual Accounts on a going concern basis. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE ERNNIGS AND OUTGO Your Company has been engaged in hotel industry. The source of energy for the Company is Electricity and Gas. The Electricity charges contributes major portion of expenses of the Company. In view of this, your Board is striving for the conservation of Electricity under the supervision of one senior Executive on a continuous basis, to achieve optimum consumption of electricity and other fuels. The other information as required under the Companies (Disclosure of particular in the report of the Board of Directors) Rules, 1988, is not applicable to the Company and hence disclosure is not made regarding technology absorption. The details of foreign exchange earnings and outgo are as under: Foreign Exchange Earned - NIL Foreign Exchange outgo - Rs.0.38 lacs DEPOSITS The Company has not accepted deposits from the public within the meaning of provisions of Section 58A of the Companies Act, 1956 and the Rules made thereunder. AUDITORS M/s Manoj Lekinwala & Co. Chartered Accountants, Gandhinagar, Statutory Auditors of the Company retires at the ensuing Annual General Meeting. The Audit Committee has recommended to the Board the re-appointment of M/s Manoj Lekinwala & Co. as statutory Auditors along with M/s. G. J. K & Associates to be appointed as joint Auditors of the Company and you are requested to consider their re-appointment along with joint Auditor. The Auditors have given the certificate that the re-appointment, if made, will be within the prescribed limit specified under section 224 (1B) of the Companies Act, 1956. The Auditors observations read with the Notes to the accounts are self explanatory. REPORT ON CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION ANALYSIS As required under Clause 49 of the Listing Agreement, your Company has already implemented Corporate Governance for the financial year 2010-2011. A Management Discussion and Analysis Report along with detailed report on Corporate Governance attached with this Report and form part of the Annual Report. ACKNOWLEDGMENTS Your Directors place on record their sincere appreciation for the service and co-operation extended by the Government Departments, State Bank of India, financial institutions, business associates and continue support of the employees at all levels and all the investors of the Company, which helped the Company to sustain its growth even during the challenging times. By Order of the Board, For, GANDHINAGAR HOTELS LTD Place : Gandhinagar Pritesh V Joshi Date : 30.08.2011 Vice Chairman & Jt. Mg. Director. MANAGEMENT DISCUSSION AND ANALYSIS REPORT This Management discussion covers the financial results and other developments during April, 2010 to March, 2011 in respect of the Company. Some statements discussion describing the projection may be forward looking actual results may be forward looking actually may different materially on account of various external factors such as government regulations, tax regimes, changes in demand and supply constrains and other identical factors. Overview The Hotel Haveli as of now is Fortune Inn Haveli started its business operations in the year 1991 and upgrading its facilities and hospitality services on a year to year basis. The Hotel is a 3 star business hotel strategically located at Gandhinagar, the capital of state of Gujarat. Industry structure The year 2010-2011 witnessed an inclusive economic growth, especially state of Gujarat. The growing industrialization in the state of Gujarat helped the hotel industry to grow efficiently and rapidly. The overall year showed positive trend for hotel industry. Prospects The hotel industry is largely dependent on the growth of the other industries. The year 2010-2011 showed a rapid growth in other industries. During the year company has signed MOU with the Government of Gujarat for development of two 5 Star category hotels. The hotel business is likely to grow in recent future by offering excellent hospitality and quality services. The Company is committed to provide quality services. Opportunities, Threats, Risks and concerns The Company enjoys a fairly good position in the hotel industry with the Fortune Inn Haveli brand name. In view of the strategic plans and vision, the company is set to achieve higher rate of growth by catering needs and excelling in hospitality and services. In view of the rapid growth witnessed by other industry, the company expects to grow strongly. Strengths & Weaknesses Hotel is conveniently located to cater to business and other guests. : Frequent Changes in lower category of staff Existing Profit generating Hotel : High tax structure in the business including luxuries tax and other taxes Experienced Management Team and Motivated Work Force : Increasing in the Operating cost of the Company and other fix expenses Capacity of Standard Room for availing largeClient base. : Opportunities & Threats Sales and Marketing arrangement with fortune parks Hotels Limited Gives very vast opportunity : Increasing Competition in hotel business The Focus on Corporate Clients which tend to increase in Gandhinagar due to GIFT project of Gujarat Govt : The business largely depends on corporate events and affected by govt. Policies Strong Brand Tie-up Increasing cost of Raw Materials : Raising Income level attract the business Increase in cost of maintenance Internal Control Systems The Company has adequate internal control systems in respect of efficiency of operation, financial reporting, compliance with laws etc. Exercises for safeguarding assets and protection against unauthorized use are undertaken. The Management review internal control system from time to time. Review of Financial Performance The Financial performance during the year ended 31st March, 2011 was satisfactory with compare to last financial year. The Company expects better performance in the years to come. During the year under review the Company has achieved a Net profit of Rs. 85.03 Lacs as Compared to Rs. 76.68 Lacs for last financial year. Human Resources Our senior management team consists of experienced individuals with diverse skills in manufacturing, engineering, international business and finance. We believe that our employees are the key to the success of our business. We focus on hiring and retaining employees and workers who have prior experience in the hotel industry. The relations between the employees and the Management have remained cordial. Segment Wise or product wise performance: The details regarding Performance of various sources of the Company for current as well as last financial year is as under by way of graphical presentation: