rushabh precision bearings ltd Directors report

RISHABH PRECISION BEARINGS LTD DIRECTORS REPORT To the Members, Your Directors have pleasure in presenting the NINTH ANNUAL REPORT together with the Audited Statement of Accounts for the year ended 31st March, 1998. OPERATIONS: The year under report witnessed unsatisfactory for Indian Industry as a whole. The crisis in South East Asia has also affected Indian economy which resulted into overall decline in rate of growth of Industrial Production to 4.2% compared to 7.1% in last year. Consequently, there was adverse effect on automobile industry. The companys 80% of the production is absorbed on consumption by the Automobile Industry. The year under review was not particularly favourable to the company due to overall recession being witnessed by the automobile industry as a whole. The company had to reduced its prices in view of ongoing recession and depressed market conditions, which started around January, 1996. There was expectation and hope for improvement of demand in Auto industry, however the same was not fulfilled. In fact production of heavy and medium commercial vehicles dropped by 38% and light Commercial vehicles by 4%. The car industry registered negative growth of 2% and two wheeler industry had small growth of 3%. Hence bearing industry as a while suffered severe set back, first on reduced prices and next on volume. Under the adverse circumstances, your company has managed to have turnover of Rs.22.78 lakhs compared to previous year turnover of Rs. 21.55. Lakhs. Your company has envisaged a capital expenditure project of Rs. 140.00 crore for which land has been acquired at Ahmedabad to put up additional capacity to manufacture Ball and Taper Roller. Your company is taking steps to boost its market share by approaching OEM Original Equipment Manufacturers) and also Railways, Defence Department for this bulk requirement. DIVIDEND :- In view of negligible profit, your Directors do not recommend any dividend for the year under Report. DIRECTORS :- During the year under report Mr. Sanjiv M. Gupta and Mrs.Sunayana R. Vora have resigned as Directors of the Company. The Board expresses its appreciation for valuable guidance and co-operation received by the Company from then time to time during their tenure as Directors. Mr. Dhirajlal H. Vora and Mr. Pravin B. Kamdar, Directors of the company retire by rotation and, being eligible, offer themselves for reappointment. FINANCE :- Your Company has approached Financial Institutions and OBC and Non Resident Indian for the placement of 60,00,000 Equity Shares of the Company on Private Placement Basis for which the necessary approval of the members was already obtained in the 8th Annual General Meeting of the Company. The purpose of raising the resources through the above source is to finance the working capital, requirements and also to finance the capital expenditure programme of the company. In view of depressed market condition in Ball bearing Industry your company has also approached their Bankers/Financial Institutions for reschedulement in repayment of financial facilities granted by them. The NCD on private placement are due for Redemption on 30th November, 1998. The same has been decided to be extended for a further period of 18 months as per the terms of the issue. In view of applications made to Banks and Financial Institutions for waiver of Interest, no interest has been provided in the accounts. With reference to item No.11 under Notes forming part of Accounts, the company has not given effects in Revised Account of relevant year, since the matter is pending with Income Tax Authorities. AUDITORS : - M/s. S. M. Bhat & Co., Chartered Accounts, Mumbai retire as Statutory Auditors of the Company at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for reappointment. The members are requested to appoint Auditors for the current year and fix their remuneration. The present auditors has furnished a certificate regarding their eligibility for re- appointment as Companys Auditors pursuant to Section 24 (1B) of the Companies Act, 1956. PARTICULARS OF EMPLOYEES: The information in accordance with the provisions under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 is not applicable as no employee of the Company, during the year under report, was drawing salary as mentioned in the said provision. INFORMATION REGARDING CONSERVATION OF ENERGY ETC. Information as required u/s 217(1) (e) of the Companies Act 1956 as may be applicable, is annexed hereto. INDUSTRIAL RELATIONS Industrial relations at the plant of the Company at Surendranagar remain cordial. Directors wish to convey their appreciation for the contribution made by the employees at all level. ACKNOWLEDGEMENT: Your Directors take this opportunity to place on record their appreciation of the devoted services of the employees at all levels throughout the year. Your Directors also wish to place on record their appreciation of the assistance and continued co- operation extended by the Banks, Financial Institution in particular Government Authorities Suppliers, Consultants etc. For and on behalf of the Board of Directors Dhirajlal H. Vora Chairman Place : Mumbai, Date : 8th October, 1998.