Sanghi Polyesters Ltd Share Price directors Report
SANGHI POLYESTERS LIMITED
ANNUAL REPORT 2008-2009
DIRECTORS REPORT
To
The Members of
Sanghi Polyesters Limited,
Your Directors take pleasure in presenting the Twenty Second Annual Report
of your Company along with the audited Financial Statements for the period
ended 31st March, 2009
(Rs. in Lacs)
Financial Highlights: 2008-09 2006-07
(15 months) (15 months)
Total Income 39860.52 24691.50
Profit/(Loss) for the year (4554.26) 74.08
Profit & Loss Account brought (3108.98) (3183.06)
forward
Carried over to balance sheet (7663.24) (3108.98)
Operations:
During the year under review, the company has achieved a sales turnover of
Rs.39860.52 lacs with a production volume of 55085 Metric Tons. The company
has reported a net loss of Rs.4554.26 lacs during the year under review,
whereas during the previous year the Company made a loss of Rs.4638.68
lacs, which was adjusted against an extraordinary income of Rs.4712.76 lacs
resulting in a Net Profit of Rs.74.08 lacs.
Corporate Governance Report:
A separate report on Corporate Governance is furnished as part of the
Annual Report and the certificate from the companys Auditors regarding
compliance with the said Corporate Governance Code is annexed to the said
Report.
Directors Responsibility Statement:
Pursuant to the requirement under Section 217 (2AA) of the Companies Act,
1956 with respect to the Directors Responsibility Statement, it is hereby
confirmed that-
a) In the preparation of the accounts for the accounting period ended 31 st
March, 2009, the applicable accounting standards have been followed along
with proper explanation relating to material departures;
b) The Directors have selected such accounting policies and applied them
consistently and made judgements and estimates that were responsible and
prudent so as to give a true and fair view of the state of affairs of the
Company at the end of the accounting period and of the profit or loss of
the Company for the period under review;
c) 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;
d) The Directors have prepared the accounts for the accounting period ended
31st March 2009 on a going concern basis.
Deferred Tax:
Your Directors have reviewed the requirements of AS-22 issued by the ICAI
which are applicable to your Company during this period, to recognise
Deferred Tax Assets and Liabilities. Taking in to account the quantum of
current and unabsorbed losses and the present status of the industry, the
Directors feel that the Company need not recognize Deferred Tax Assets in
respect of past and current losses which, it is understood, is in
accordance with Accounting Standards.
Explanation to the qualifications made in the Auditors report:
As regards One Time Settlement (OTS), it is being informed to you that your
Directors are still negotiating with the Banks and Financial Institutions
and also trying for a tie-up with a suitable partner to pay off the lenders
of the Company on terms and conditions in the interest of the Company.
Further, in this context, no interest on term loans has been provided for
the financial year 2008-09. Regarding provision of gratuity not based on
actuarial valuation in the books of account, you Company has already
approached the actuarial valuer for doing the valuation and the report is
awaited.
Directorate:
Shri Anand Prakash Sanghi, Director, retires by rotation and is eligible
for re-appointment. Shri T.M. Jagan Mohan is retiring by rotation at the
ensuing Annual General Meeting and he has not offered himself for
reappointment.
Sri Amit Sanghi, has been co-opted as Additional Director (to be designated
as Executive Director) with effect from 31st July, 2008. Sri M.K Agarwal,
Sri M.L Agarwal, Sri O.P Jalan and Sri C.T Siva Muthy have been coopted as
Additional Directors on the Board with effect from 31st July, 2008
Sri Siddharth Sanghi, Executive Director of the Company, has been
redesignated as Joint Managing Director of the Company with effect from
30th July, 2009 by the Board of Directors in their meeting held on 30th
July, 2009.
Auditors:
M/s. Jayant & Sadashiv, the Companys retiring auditors, being eligible,
offer themselves for reappointment.
Cost Audit:
With the approval of the Ministry of law, Justice & Company Affairs,
D.C.A., Mr. S.G.Ramakrishna Cost Accountant, has been appointed as the Cost
Auditor of the Company to audit the Cost Accounts of the Company for the
accounting period ended 31st March, 2009.
Personnel:
The information about employees pursuant to Section 217 (2A) of the
Companies Act., 1956 forming part of this Report is annexed to this Report
by way of Annexure - I.
Energy Conservation:
Your Company continues its policy of giving priority to energy conservation
measures including regular review of energy generation and consumption and
effective control on utilization is achieved from the design stage of plant
itself and is then maintained and improved in the normal plant operations.
Continuous updating of energy conservation efforts is achieved by frequent
energy audits at operating levels. Please see the details of Energy
Conservation attached to this Report by way of Annexure - II.
Technology Absorption. Adaptation & Innovation:
As reported in the past, your Company has adopted and fully absorbed the
technology provided by M/s Kohap Limited of South Korea. Further dependence
of foreign technology has been avoided as the Company has been able to
evolve on its own various strategic measures to improve efficiencies,
upgrade qualities and increase production with simultaneous cost reduction.
Foreign Exchange Earnings & Outgo:
Particulars with regard to Foreign Exchange Earnings and Outgo are set out
in Note No. 7 in Schedule 14 to the Accounts.
Environmental & Pollution Control:
Your Company on an ongoing basis is monitoring environment and pollution
parameters at its plant at Sanghinagar. The Company has adopted several
measures like smoke precipitators, effluent treatment plants, planting of
trees etc., to keep the environment healthy, a matter of global concern
now. The actual values of parameters achieved by the plant are
substantially better than those specified by the pollution control
authorities. Your Company is determined to maintain and improve these
parameters in the years to come.
Industrial Relations:
The industrial relations continued to be cordial throughout the year. Your
Directors wish to place on record their appreciation for the excellent team
work with which the workers and officers of the company at all levels have
contributed individuality and collectively to the impressive performance of
the Company.
Acknowledgements:
Your Directors would like to thank the shareholders, customers, suppliers,
financial institutions and banks, State and Central Government Agencies for
the support they have given to the Company and confidence which they have
reposed in its management.
On behalf of the Board of Directors
Chairman
Place: Hyderbad,
Date : 29th August, 2009
Annexure - II
FORM - A
A. CONSERVATION OF ENERGY
a) Energy Conservation measures taken: The Company has installed energy
saving devices in lighting circuits to stop wastage. High efficiency
generating sets have been installed and the equipments are energy
efficient.
b) Additional investment and proposals: Nil
c) Impact of measures: Energy Conservation measures adopted by the Company
will result in reduction of cost of product.
B. POWER AND FUEL CONSUMPTION 2008-09 2006-07
(15 Months) (15 Months)
1. Electricity
a. Purchased Units (Kwh) 59079701 46186780
Total Amount (Rs.in Lacs) 1910.31 1710.70
Rate/Unit (Rs.) 3.23 3.70
B. Own Generation
Through Diesel Generators (Kwh) 304419 193560
Diesel Oil Used (Ltrs) 107615 64980
Rate of Diesel Oil per Ltr (Rs.) 34.65 34.09
Cost of Diesel oil used (Rs. Lacs) 37.29 22.15
Lube oil consumed (Lts) 1850 1260
Rate of Lube oil (Rs. per Lts) 133.87 103.17
Cost of Lube oil (Rs. Lacs) 2.48 1.30
2. Coal (Specify Quality and where used): N.A. N.A.
3. Furnace Oil
Quantity (KL) 4356.39 2882
Total Amount (Rs. Lacs) 1252.80 614.43
Average (Rs. per KL) 28758 21318
4. Other/Internal Generation
(Steam Production):
Quantity (Tons) 1852 2705
Furnace Oil Consumed (MT) 152 226
Total Cost (Rs. Lacs) 291.03 175.90
Rate/Unit Ton (Rs.) 801.29 666.64
F.O. Consumption (Lt/Ton of Steam) 81.91 83.55
5. Consumption per unit of Production
1. Electricity (Kwh/Ton) 1078.05 1389.38
2. Furnace Oil (per ton of Polymer Prod) 82.59 95.71