Murli Industries Ltd Directors Report.

Directors

To the Members,

Your company’s Directors are pleased to present the 23rd Annual Report of the Company along with the audited accounts for the financial year (Nine months) ended 31st March, 2014.

1.1 Financial Results

The financial performance of the Company for the financial year (nine months) ended March 31, 2014 is summarized below. The current financial year is consisting of nine months and the previous financial year was of fifteen months and hence the comparison between the financial year to year could not be possible. The data provided for the purpose of better information.

Sr.No. Particulars Financial Year 2013 - 2014 Financial Year 2012 - 2013
(For Nine Months) (For Fifteen Months)
1 Sales 24,680 68,879
2 Profit Before Depreciation and Amortisation (8,341) (4,244)
Expenses, Finance Cost and Tax Expenses
Less: Finance Cost 9921 20,063
Depreciation And Amortisation Expenses 4516 7,999
Profit Before tax (22,778) (32,306)
Less : Current Tax (Earlier Years) 53 13
Add: Deferred Tax (Assets) - 8,876
Profit for the Year (22,831) (23,443)
Less: Prior Period Item - -
Add: Balance in Profit & Loss Account (39,334) (15,891)
TOTAL (62,165) (39,334)
Less: Appropriation :
Proposed Dividend on Equity Shares 0.00 0.00
Tax on Dividend 0.00 0.00
Closing Balance (62,165) (39,334)

1.2 Segmentwise Turnover

( Rs in Lacs)
Sr.No. Particulars Financial Year 2013-14 Financial Year 2012-13
(Sales) (Sales)
(For Nine Months) (For Fifteen Months)
1 Solvent Extraction 840 7,686
2 Paper 11,363 31,750
4 Cement 12,477 29,443
Total 24,680 68,879

Note: The last financial year ended 30.06.2013 of the company consisted of fifteen months and hence the current financial year was supposed to be end on June 30, 2014. The board of directors in its meeting held on 14.02.2014 after considering the section 2(41) of the New Companies Act, 2013 decided to align its financial year as per the provisions of said clause. Hence the Current Financial Year ended 31.03.2014 consist of nine months period.

The figure of the turnover of the previous year has been changed due to regrouping of the accounts. Further the figure of the Power segments is not included in the total turnover of the company due to inter segment consumption.

Financial Operations :

The period in question of the company consists of nine months. During the said period the company achieved a turnover of Rs 24,680 Lacs. The profit of the company continues in the negative during period too. The net loss for the period is Rs 22,831 lacs. The accumulated loss of the company reached to Rs 62,165 lacs.

Dividend

The meeting of Board of Directors was held on 30th August, 2014. After discussion it was decided that the company is suffering through the cash liquidity crisis due to utilization of less capacity of all units of the company and the burden of high rate of interest hence it is recommended not to distribute any dividend for the year ended March 31, 2014.

Transfer to Reserves

The company decided not to transfer any amount to general reserve this year due to insufficient profit for the period ended March 31, 2014.

Subsidiary Company :

The company has four wholly owned subsidiary companies as on March 31, 2014. The names are – (i) Murli Cement Limited; (ii) Murli Cement (Maharashtra) Limited; (iii) Murli Cement (Rajasthan) Limited; and (iv) Murli Cement (Karnataka) Limited. The companies are incorporated but yet to start any operation. The board in its meeting held on May 29, 2014 proposed not to attach the balance sheet of the subsidiary companies. The summery of financial statement of there attached at the end of this annual report.

Finance :

The Corporate Debt Restructuring (CDR) is being implemented vide the CDR Cell. The Period of scheme was sanctioned for ten years from the cutoff date i.e. 1st September, 2010. The present CDR scheme cease to exist due to the non co-operation of the member banks and they have withdrawn from the scheme. Few banks also informed that they have assigned their credit facilities to Assets Restruction Company (ARC)/ Assets Management Company.

Insurance:

The company continues to carry adequate insurance cover for its assets against the possible risk like fire, flood, public liability, marine etc.

Corporate Social Responsibilities:

The Company formed a CSR committee consisting of three directors of the company out of which two are independent directors and one executive director. The function of the committee will be as per the provisions of the section 135 (3) of the Companies Act, 2013 and schedule VII of the said act.

BIFR : The management of the company on 24th September, 2013 referred to the Board For Industrial and Financial Reconstruction after considering the Audited Balance Sheet of the company in its meeting held on August 29, 2013. The said reference has accepted by the Registrar and the same is registered. The procedure for declaration of sickness of the company has been going on.

Stock Exchange Information

The Equity shares of the Company continue to remain listed on the Bombay Stock Exchange and National Stock Exchange and the annual listing fees has been paid to all the Exchanges.

Registrar & Transfer Agent:

Link Intime India Private Limited, C-13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West) Mumbai – 400078 is the Registrar and Share Transfer Agent of the company for the physical and demat shares. The members are requested to contact the Registrar directly for any of their requirements.

Corporate Governance Report and Management Discussion and Analysis Statement

The Auditor, M/S Demble Ramani & Co., Chartered Accountants has certified the Company’s compliance of the requirements of Corporate Governance in terms of Clause 49 of the Listing Agreement. The said Certificate together with the management discussion and analysis statement is attached there was and forms part of this Report.

Director

Shri Rajinder Paul Gupta and Director, Shri Bhargavaram P. Ganu, Director of the company will retire by rotation with the conclusion of Annual General Meeting. Shri Rajinder P. Gupta, directors informed to the management that he has shifted to Delhi for permanent residence and due to the age he will not be able to continue to be director of the company. Shri B. P. Ganu, director, due to the health problem will not be able to continue the directorship of the Company. Shri Alok Srivastava, nominee director of the bank has been promoted and transferred to Delhi and the company received request from the bank to appoint Shri H. K. Bhutani, AGM as a nominee director in place of Shri Alok Srivastava, Shri Yashpal Dhiman, Executive Director, will retire by rotation in the ensuing Annual General Meeting and offers himself for reappointment.

Shri Subhash Rode, Shri Avinash Mardikar and Shri Vinayak Thergaonkar, are Independent directors of the company. These directors will be appointed as per section 149, 150 & 152 of the Companies Act, 2013 rules there under and new listing agreement.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of The Companies Act 1956, with respect to Directors’ Responsibility Statement, it is hereby confirmed that:

(1) In the preparation of the annual accounts for the financial year ended March 31, 2014, the applicable accounting standards read with requirements set out under Schedule VI to the Companies Act, 1956, have been followed and there are no material departures from the same;

(2) The directors have selected such accounting policies and applied them consistently and made judgment and estimates that were 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 and loss of the Company for the year ended on that date;

(3) The directors have taken proper and sufficient care of 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; and

(4) The directors have prepared the Annual Accounts of the company on a ‘going concern’ basis.

CEO / CFO Certificate:

In terms of Clause 49 (V) of the listing agreement, the certificate duly signed by the CEO/CFO of the company was placed before the Board of Directors along with the annual financial statements for the year ended 31st March, 2014, at its meeting held on 29th May, 2014.

Auditors and Auditors’ Report

M/s. Demble Ramani & Co., Chartered Accountants, Statutory Auditor of the Company, will retire at the conclusion of the ensuing Annual General Meeting, and is eligible for reappointment. It has shown its willingness to accept reappointment and has further confirmed that their re-appointment, if made, would be within the prescribe limits under section 141(g) of the Companies Act, 2013 and they are not disqualified for reappointment.

The Notes on Financial Statement referred to in the Auditors’ Report are self-explanatory and do not call for any further comments.

Cost Auditros

The company has appointed to M/s Khanuja Patra & Associates, cost auditors for conducting the Cost Audit for the Agro Business, Paper Business and Cement Business for the financial year ending 31.03.2015. The Central Government has approved the same.

Other Information

Inter–personnel relations in the Company remained harmonious during the period under review. Particulars as required under Section 217 (1)(e) of the Companies Act, 1956 relating to Conservation of Energy and Technology Absorption are provided in the annexure to this report together with particulars of Employees as required under section 217 (2A)(a) of the Companies Act 1956.

Appreciation & Acknowledgement

Directors wish to place on record their deep appreciation to employees for their hard work, dedication and commitment.

The Board place on record their deep appreciation for the support and co-operation which your company has been receiving from its suppliers, distributors, business partners, and other associated with the company as its trading partner.

Directors also take this opportunity to thank all investors, clients, Vendors, Financial Institutions, Banks, Government & Semi-Government authorities and stock exchanges for their continued support.

For and on behalf of the Board of Directors
For Murli Industries Limited
Sd/-
Place: Nagpur Nandlal Maloo
Date: 30th August, 2014 Chairman & Managing Director

Annexure to the Report of the Directors:

Information under section 217(e) of the Companies Act, 1956 read with companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988 and forming part of the Directors’ Report

(I) Conservation of Energy

The Company is having its own captive power plant at Paper Units, situated at Umred, Nagpur and at Cement Plant, Chandrapur. The powers requirement fulfill by these captive power plants thus saving the overheads on power & conserving energy as well. The company established the power unit with advance technique and latest machinery for maximum utilization and saving the power pilferage. Also the company utilized the electric saver equipment in all the factories and office premises for saving the maximum power possible. It shows the great result by saving the power to a great extent. Further the company is having special team of experts who look after the best possible way to conserve the energy and take necessary steps whenever require. All manufacturing units of the Company continued the endeavor to improve specific energy consumption, a measure of energy used per unit of consumption.

(II) Impact of measures above for reduction of energy consumption and consequent impact on the cost of production of goods

Energy’s conservation measures initiated across the company’s businesses have resulted in significant savings and helped partially offset the inflationary trend in the fuel/electricity costs. Business wise specific energy consumption figures indicate very competitive performance. The energy saving also helped the company to reduce total Carbon Dioxide emissions.

Information under section 217 (2A)(a) of the Companies Act 1956 read with companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988 and forming part of the Directors’ Report :

(I) FORM A :

(a) Power and Fuel Consumption

2013-2014 (For Nine Months) 2012-2013 (For Fifteen Months)
Products De-oiled cake, Refined Oil, Duplex Board, Newsprint, Writing Printing Paper, Power, SBS & Cement De-oiled cake, Refined Oil, Duplex Board, Newsprint, Writing Printing Paper and Power, SBS & Cement
1. ELECTRICITY
(i) Purchased
Units (KWH )Lacs 19.90 170.58
Total Amount ( Rs Lacs) 176.34 1358.63
Rate/Unit ( Rs ) 8.86 7.96
(ii) Own Generation (MW) 1,258.48 1,776.76
2. COAL
Steam Coal (MT) 3,36,710.29 3,66,804.74
Total Cost ( Rs Lacs) 6,979.29 6,314.74
Avg. Rate ( Rs /MT) 2,072.79 1,721.55
3. OTHER / INTERNAL GENERATIONS NIL NIL

(b) Consumption per unit of Production

2013-2014 (For Nine Months) 2012-2013 (For Fifteen Months)
Products De-oiled cake, Refined Oil, Duplex Board, Newsprint, Writing Printing Paper, Power, SBS & Cement De-oiled cake, Refined Oil, Duplex Board, Newsprint, Writing Printing Paper, Power, SBS & Cement
Electricity (KWH) 212.65 199.72
Steam Coal (MTs) 0.56 0.38
Others NIL NIL

(II) Technology Absorption

Research and Development (R & D)

The Company established research and development centre for the cement products at Cement Unit, Chandrapur. This centre has been concentrating on the research and development of cement products and its best use. The company with the association of SOPA has been carrying out R&D activities in Soya Segment for best possible production of soyabean in the adverse condition of the Vidarbha Region and its neighbour States.

Technology Absorption, Adaptation and Innovation :

Company has already established the latest technology available in the technical field; however it seeks to introduce new innovations for increasing the production capacity and for better quality of its products.

(III) Foreign Exchange Earnings and Outgoings

The Company exported Writing Printing Papers and Duplex Board to Bangladesh, Srilanka, Malaysia, Dubai and Bangkok. However foreign exchange outgoings were on account of Import of Waste paper for Company’s Duplex Board, Newsprint, Writing Printing Units and SBS Board Unit for the current as well as previous year.

Sr.No. Particulars 2013 - 2014 2012 - 2013
(For Nine Months) (For Fifteen Months)
1 FOB Value of Exports (In Lacs) 0.00 INR 42.00
2 FOB Value of Exports (In Lacs) 0.00 USD 0.80
3 Foreign Exchange Outgoings
4 CIF Value of Imports (In Lacs) INR 329.11 INR 1,553.00
5 CIF Value of Imports (In Lacs) USD 2.47 USD 29

Annexure to the Report of the Directors related to Employees Remuneration U/sec 217(2A)(a):

Name Age Desig- nation Gross Remun- eration Net Remun- eration Qualification Experience Date of Comm- ecement of Employment Previous Employer
*Shri Kamal Kishore Tapadia 62 CEO Rs. 72/- Lacs p.a. Rs. 5,40,000 per month BE (Mechanical) 36 yrs. 31/10/2013** Universal Construction Machinery & Equipment Ltd., Pune
Shri Purush- ottam Acharya 60 COO Rs. 72/- Lacs p.a. Rs. 5,40,000 per month BE (Mechanical), MBA 35 yrs. 10/09/2013* Binani Cement

Note: **Resigned on 31.10.2013 & *Joined on 10.09.2013.