DIRECTORS REPORT
To the Members of Volant Textile Mills Ltd.
Your Directors have pleasure in presenting the Eighteenth Annual Report for the year
ended 31st March, 2013.
FINANCIAL RESULTS
|
|
(Rs. in lacs) |
|
Current Year |
Previous Year |
| Gross profit/ (loss) before |
|
|
| Interest depreciation & exceptional/ Extra ordinary items |
54.36 |
193.62 |
| Less: Financial charges |
(27.06) |
(33.33) |
| Profit before Depreciation |
27.30 |
160.29 |
| Less: Depreciation |
(119.32) |
(118.99) |
| Net Profit/(Loss) |
(92.02) |
41.30 |
DIVIDEND
In view of accumulated losses, your directors do not recommend any dividend for the
year under review.
OPERATIONS
The Company is exploring opportunities for manufacturing niche products. During the
year due to volatility of cotton yarn, the companys profitability has been hampered,
however this is a temporary phenomenon and growth and profitability of the company should
be intact in the coming year.
The total sale during the year was Rs. 3,024.10 lacs (Rs. 2,176.10 lacs). This includes
direct export sales of Rs 46.39 lacs (Rs. 219.07) and Rs.NIL lacs (Rs. 12.69 lacs) made
through merchant exporters.
Your Company has been certified for ISO 9001:2008 Quality Management Systems by GL
Systems Certification. The certification is valid till 23rd February, 2015.
The company has also received Trade Marks registration certificate from 08th July 2013
and this would help the company to create its brand value.
REVIEW AND FUTURE PROSPECTS
The company was declared a sick industrial unit under section 3(1)(O) of SICA, 1985, by
BIFR in case no. 322/02 in March, 2006, and Bank of Baroda was appointed the Operating
Agency. The Honble BIFR held a hearing on 31st May, 2012 and has asked the Company to
submit an updated scheme with the cut-off date as 31st March, 2012. The revised updated
scheme of Rehabilitation is submitted to the OA. Creditors meeting was conducted on 17th
September, 2012. The revised Draft Rehabilitation Report is submitted to the Honble BIFR.
The company has proposed the merger with another unit for manufacturing of technical
textile products and the said merger is part of the rehabilitation scheme submitted to the
OA & Honble BIFR. The OA is to incorporate the provisional figures of March 2013 and
resubmit the scheme to the Honble BIFR. All necessary permission and approval for the
same would be taken by the company at the appropriate time.
The merger of the Company would bring about better synergies and value addition of its
products. This would enable the company to enhance operations, improve efficiencies,
provide economies of scale, open up new and potential markets and thus unlock synergies to
derive maximum valuation for all stakeholders. Imposition of added tax burdens through
LBT, Service Tax etc. may hamper growth. Under the circumstances, the company remains
continuously optimistic of future business prospects.
Unprecedented fluctuation in cotton and cotton yarn prices affected the working of the
Company.
OUTLOOK
Assuming the inflation is brought under control and input prices revert to a more
moderate level, the domestic market is expected to continue to deliver a healthy growth.
The raw material prices are expected to stabilize due to good cotton production. The
demand growth is likely to push up due to overall economic recovery. The directors are
very optimistic of the textile trade and feel that with the pro-active government
policies, the Indian textile industry can have a dominant share in the world trade after
China. We are taking a long term view of the industry and hope to increase turnover and
margins from the current position. Simultaneously the company is exploring opportunities
to venture into manufacturing of niche products, strengthen the quality of its products
and reduce the conversion cost. These initiatives are expected to positively influence the
working of the company. However rising energy prices and increase in labour costs due to
hike in minimum wages will lead to increase in manufacturing costs. The depreciation of
Rupee will make India more competitive in the export market, and has an opportunity to be
the textile suppliers to the world.
DIRECTORS
At the ensuing Annual General Meeting, Mr. D. A. Tare and Mr. Atul B. Raval Directors
of the Company, retires by rotation and being eligible offers himself for re-appointment.
Mr. D. A. Tare and Mr. Atul B. Raval are Directors of the Company having vast experience
in industry and administration in their respective field.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956 with
respect to the Directors Responsibilities Statement, it is hereby confirmed:
That in the preparation of the annual accounts, the applicable accounting standards
have been followed.
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 of the Company at the end of the financial year on 31st
March 2013 and of the profit/loss of the Company for that period;
That the Directors have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of Companies Act, 1956 for
safeguarding the assets of the Company and for preventing and detecting fraud and other
irregularities; and
That the Directors have prepared the annual accounts on a going concern basis as the
Company has started generating profits.
AUDITORS
M/s Shah, Patani & Associates, Chartered Accountants, Mumbai, have requested not to
be reappointed for the F.Y. 2013-14, hence M/s P.C. Ghadiali & Co. are been appointed
as Statutory Auditors of the Company. Accordingly, a resolution proposing their
appointment is being submitted in the ensuing Annual General Meeting. The members are
requested to consider their appointment for the current financial year 2013-14.
AUDITORS REPORT
The Notes on accounts, referred to in the Auditors Report are self explanatory and
therefore, do not call for any further comments under Section 217(3) of the Companies Act,
1956.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO
As required under Section 217(1)(e) of the Companies Act, 1956 read with rule 2 of the
Companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988,
information relating to Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo is annexed as Annexure "A" to Directors Report.
PUBLIC DEPOSITS
The Company has not accepted any deposit from the public within the meaning of Section
58A of the Companies Act, 1956 and the Rules made thereunder.
CORPORATE GOVERNANCE
A separate section on Corporate Governance and a certificate from the Auditor of the
Company regarding compliance of conditions of Corporate Governance as stipulated under
clause 49 of the Listing Agreement with Stock Exchanges, form part of the Annual Report.
LISTING
The Company had applied to get the shares delisted from Ahmedabad and Jaipur Stock
Exchanges in the year 1999 in view of the nil trading there, but the delisting procedure
has not been completed. The Company hopes to get their shares delisted from Ahmedabad and
Jaipur Stock Exchanges as per the provisions of SEBI (Delisting of Securities Guidelines),
2003, the Listing Agreement for which a Special Resolution was passed at the 12th Annual
General Meeting of the Company. The company hopes that the Ahmedabad and Jaipur stock
exchange would assist the company in delisting its shares from their respective stock
exchanges.
RISK MANAGEMENT
Todays business environment, remains challenging for the Corporate World and risk
management retains its high position on every organizations agenda. The Company has
several risk factors which could potentially impact its business objectives, if not
perceived and mitigated in a timely manner. The senior management team sets the overall
tone and risk culture of the orgnisation through defined and communicated corporate
values, clearly assigned risk responsibilities, appropriately delegated authority, and a
set of process and guidelines. The Company has laid down procedures to inform the Board
members about the risk assessment and risk minimization procedures. As an organization, it
promotes strong ethical values and high levels of integrity in all its activities, which
in itself is a significant risk mitigator.
With the growth strategy in place, risk management holds a key to the success of its
journey of continued competitive sustainability in attaining its desired business
objectives.
PARTICULARS OF EMPLOYEES
There are no employees covered under the provisions of Section 217 (2A) of the
Companies Act, 1956, read with the Companies (particulars of the Employees) Rules, 1975 as
amended.
INVESTOR SERVICES
In its endeavor to improve investor services, your Company has created an investor
section on the website www.volant-textile.com and has provided a dedicated email id for
the members to lodge their complaints or suggestions.
ACKNOWLEDGEMENTS
Your Directors are pleased to place on record their sincere gratitude to financial
institutions and business constituents for their continued valuable co-operation and
support to the Company during the year.
Your Directors thank the Shareholders, Banks, Customers, Vendors and other business
associates for their confidence in the Company and its management and look forward to
their continued support.
Your Directors also wish to place on record their appreciation for the dedication with
which the employees at all levels performed their duties and for their cooperation and
support in stabilizing the production and quality.
|
On behalf of the Board of Directors |
| Place: Mumbai, |
Rajesh Somani |
| Date: 14th August, 2013 |
(Chairman) |
ANNEXURE "A" TO DIRECTORS REPORT
Information as per Section 217(1)(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 for the year ended 31st March 2013.
I. CONSERVATION OF ENERGY
1) The company has made efforts to incorporate energy conservation measures in the
installation stage itself.
| 2) |
Current Year |
Previous Year |
| Power & Fuel Consumption |
|
|
| Electricity: |
|
|
| Purchased Units (KWH) |
12,35,750 |
13,97,195 |
| Total amount (Rs. In lacs) |
60.14 |
53.55 |
| Rate/Unit (Rs.) |
4.87 |
3.83 |
| Generated Power: |
|
|
| Diesel Consumption (Ltrs) |
NIL |
NIL |
| Total amount (Rs. In lacs) |
NIL |
NIL |
| Total Units Generated |
NIL |
NIL |
| Cost per unit (Rs.) |
NIL |
NIL |
3) Continuously prefer for Improvement in power factor.
4) The Company has been using low wattage tubes and electronic ballast in its shed
resulting in energy savings.
II. TECHNOLOGY ABSORPTION
Research and Development (R&D)
1) Specific areas in which R&D carried out by the Company
• Process parameter control through Quality Assurance by various testing methods
to improve productivity and fabric quality.
• Strict quality control in grey fabric inspection area.
• Process optimization/ recipe modification/ introduction of new chemicals for
cost economy .
• Process standardization for consistent quality and meeting customer
requirements.
• New process development to overcome working problems in production department
and meeting marketing needs.
• New product development for improved marketability of products.
• New design development of creating facilities for providing world class designs
of products for the matress ticking sector.
2) Benefits derived as a result of above R&D
• Improvement in product marketability and business viability through consistent
quality, lower cost and newer products.
• Meeting customer needs and in turn customer satisfaction.
• Introduction of new design development providing a larger product range,
targeting different market segments, better marketability and sale ability.
3) Future plan of action
• New product development in Industrial market segment.
• New marketing initiatives in technical textiles.
• Exploring possibilities for getting its fabric processed outside and to develop
marketing in processed fabric which would lead to higher margins.
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
1) Efforts in brief, made towards technology absorption, adaptation and innovation:
• Obtained ISO 9001:2008 certifications from GL Systems Certification.
• Development of designs and creating of sample bank for its jacquard looms.
2) Benefits to be derived as a result of the above efforts:
• Quality consistency due to process standardization/ optimization.
• Cost reduction arising from process/ recipe modification in various operations.
• Newer products and product range.
• Product improvement.
• Improved customer care and satisfaction.
III. FOREIGN EXCHANGE EARNINGS AND OUTGO
Direct Foreign exchange earnings is Rs. 46.39 Lacs (219.07) and Third Party Exports is
of the value of Rs. NIL Lacs (12.69 Lacs). Outgo in current year is Nil (Nil).
|
On behalf of the Board of Directors |
| Place: Mumbai |
Rajesh Somani |
| Date: 14th August, 2013. |
(Chairman) |
+91-9892691696
