rado tyres ltd Directors report

DIRECTORS

The Directors present their Twenty Eighth Annual Report for the year ended 31st March, 2014.

FINANCIAL RESULTS

Particular	For the year ended 31st March 2014	For the year ended 31st March 2013
	Amount in lakhs
Income	978.57
		766.23
Operating Expenditure	1026.22
		768.38
Operating Profit (PBDIT)	(47.65)	(2.15)
Interest	21.04
		19.19
Depreciation	80.39	77.78
Profit/(Loss) before taxation	(149.08)	(99.12)
Net Profit/(Loss) Carried forwarded to Balance Sheet	(149.08)	(99.12)

OPERATIONS

The Company registered a growth of 27.7196 during the year under review. Consequently, the Company recorded an increased income of Rs. 978.57 lacs during the year under review as against Rs 766.23 lacs of the previous year. However, the Company incurred a loss of Rs.149.08 lacs during FY-2013-14 as against the loss of Rs. 99.13 lacs for the last fiscal, due to increased cost of production, which was attributed to significant increase in wages on account of long term settlement agreement signed in the past years, increase in power tariff and one time additional provision of Rs. 50.00 lacs towards gratuity, as required under the Accounting Standards.

Certain corrective measures are being implemented to reduce the cost of conversion in the current financial year.

The demand of tyres produced by the Company are expected to be in demand in the current year. Hence, the Company is expected to do better in the current year, subject to support of the workmen and also the Companys Plant, which is an very old, producing at the optimum level.

DIVIDEND

As the Company has no distributable profits, the Board is constrained not to recommend any dividend.

SANCTIONED REHABILITATION SCHEME

The rehabilitation scheme sanctioned by the Board for Industrial & Financial Reconstruction (BIFR), has been implemented w.e.f. from 27th September, 2013. The Company has not been able to meet the projections for the year for the reasons mentioned hereinabove.

ISSUE OF EQUITY SHARES

The Company has, in terms of the Rehabilitation Scheme sanctioned by BIFR, issued following equity shares of Rs.4/- each fully paid up:

• 85,79,050 equity shares to the existing shares to the existing shareholders.

• 75,00,000 new equity shares to CEAT Limited in consideration of discharge of the loan of Rs. 300 lacs given in the past and overdue interest due thereon.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUT GO

A statement giving details of conservation of energy, technology absorption, foreign exchange earnings and outgo, as required under the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and form part of the Report.

DIRECTORS

The provisions of the Companies Act, 2013 relating to the appointment of Independent Directors are not applicable to the Company.

All the directors of the Company are liable to retire by rotation. Mr. K.N Mathew, Mr.Tom KThomas and Mr. John M. John retire by rotation at the ensuing Annual General Meeting and, being eligible, they are offering themselves for re-appointment.

BIFR has, in terms of the sanctioned Rehabilitation Scheme, nominated appointment of Mr. Sanjiv Kumar Arora (52 years) as the Special Director for a period of five years. Accordingly, he has been appointed as the additional director of the Company w.e.f July 11, 2014. He shall not be liable to retire by rotation.

As required under section 269 of the Companies Act, 1956, the Company has appointed Mr. Pawan Kumar Singh as "Manager" for a period of five years w.e.f 26th August, 2013.

HUMAN RESOURCES

There is no employee attracting Section 217(2A) of the Companies Act, 1956.

The relations with the workmen remain generally cordial during the years under review. However, workmen of one section of the manufacturing process have failed to give the norms / targeted production as per long term settlement agreement signed by them, for some frivolous reasons.

DIRECTORS RESPONSIBILITY STATEMENT

As specifically required under the Companies Act, 1956, your Directors state that:

i) In the preparation of the annual accounts, the applicable accounting standards have been followed.

ii)Such accounting policies have been selected which have been applied consistently and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company in the Balance Sheet as at 31st March 2014 and of the Statement of Profit and Loss for the said financial year ended on that date

iii) Proper and sufficient care has been taken 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.

iv) The Annual Accounts have been prepared on a "going concern" basis.

AUDITORS

Messers. Paulson & Company, the retiring auditors, have informed the Company that they are eligible for re-appointment.

They have been the auditors of the Company for the last more than 10 years. As the provisions of Section 139 of the Companies Act 2013 on rotation of the auditors are not applicable to the Company, it is proposed to appoint Messers. Paulson & Company as the auditors of the Company to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting.

AUDIT COMMITTEE

The Audit Committee currently consists of Mr. H.N. Singh Rajpoot, Mr. K.N. Mathew and Mr. P.A. Krishnamoorthy, Directors of the Company and there has been no change therein during the year under review.

ACKNOWLEDGEMENT

The Directors wish to record their sincere appreciation of the co-operation and support received from employees at all levels.

	On behalf of the Board of Directors
	Directors
	H.N.Singh Rajpoot	John M. John
Place : Cochin-11
Date : July 31,2014